CharterMac Buys ARCap Investors

CharterMac, a New York-based commercial real estate lender, is acquiring ARCap Investors, Dallas, in a transaction that increases its exposure to the commercial mortgage-backed securities sector.The acquisition price of $284.5 million will be funded through a term loan from UBS Securities and Bank of America, CharterMac said. ARCap is a fund manager, specializing in the acquisition, management, and servicing of "B- piece" CMBS and high-yield direct real estate loans. The privately held company manages a portfolio of over $2.8 billion of CMBS, according to CharterMac, which already owns a 10.7% stake in ARCap. "As commercial real estate finance continues its migration to the capital markets, it is a necessity to have a strong presence in the CMBS industry," said Marc D. Schnitzer, chief executive officer and president of CharterMac. Other drivers of the transaction include the expansion of CharterMac's fund management business, ARCap's technology platform, and "operating synergies" between the companies, Charter Mac said. After the transaction closes, ARCap will become a CharterMac subsidiary and its existing management team, led by Leonard Cotton and J. Larry Duggins, will continue to oversee ARCap operations. CharterMac can be found online at http://www.chartermac.com.