Case Study: Transitioning to Raising Third-party Equity

Services:

• Portfolio evolution and modeling
• Capital formation and deployment strategy
• Capital structuring
• Capability/gap analysis
• Enterprise modeling

A diversified real estate investor and operator approached RCLCO to help it transition its capital structure away from deal-by-deal ventures. The company’s leadership asked for our support in creating a plan to create long-term value through recurring revenue streams and afford the organization greater discretion while minimizing the cultural impact.

Approach

►RCLCO developed a pathway for the company that involved a gradual expansion of capital raising efforts across several different investment vehicles
►We identified potential partner characteristics and created terms & fee structures for future raises.
►In line with the clients objectives, our strategy focused on sourcing aligned long-term capital partners that will allow for maximal discretion.
►Our plan identified organizational gaps expected by institutional capital and we helped the company professionalize key roles including asset management.

Result

The client successfully launched a separately managed account with a culturally aligned capital partner. Since then, the company has raised an over-subscribed commingled vehicle in-line with our recommendations.