Catalyst Real Estate Fund II
What Is a Co-GP Fund?
In a commercial real estate transaction, the capital structure often consists of: common equity, preferred equity, mezzanine and senior debt. The common equity component is typically structured as a joint venture between an institutional participant providing the majority (often 85% – 95%) as Limited Partner or ‘LP’, and the balance co-invested by the developer, sponsor or ‘GP’.
Such ventures often feature an incentive mechanism with disproportionate sharing of profits. So, while a GP may only contribute 10% of the common equity, it stands to earn much more than 10% (often upwards of 50%) of the profits upon successful execution of the business plan.
The Partnership, in exchange for supporting GP’s co-invest capital requirements and facilitating more efficient growth of their business, provides superior return opportunity to investors without incremental risk.
The GP Fund expects to offer investors the following:
- Ability to participate in an Operator’s profit-sharing mechanism, generating outsized, asymmetric risk-adjusted return opportunities
- Access to institutional-quality assets, sponsorship and capital partners with minimal equity investment
- Investment diversification
- Attractive balance of current yield and capital appreciation potential
Fund Details
DISCLAIMER: This is for informational purposes only and does not constitute an offer, solicitation, invitation or recommendation to buy, sell, subscribe for or issue any securities. The Catalyst Real Estate Fund II LLC has prepared an Offering Memorandum dated December 1st, 2021 in respect of the offering and sale of its Limited Partnership Interests and any offering thereof is made only by means of the Memorandum. This information must be read in conjunction with the Memorandum in order to understand fully all of the features and risks associated with an investment in such Limited Partnership Interests. Any information discussed on this website is qualified entirely by reference to the Memorandum and the documents referred to therein. The material herein is based on information that we consider correct and any estimates, opinions, conclusions or recommendations contained in this document are reasonably held or made at the time of compilation. However, no warranty is made as to the accuracy or reliability of any estimates, opinions, conclusions or recommendations. It should not be construed as investment, legal, or tax advice and may not be reproduced or distributed to any person. This document does not constitute an offer to sell any security. Any offer will be made only by delivery of a complete private placement memorandum. This document is not soliciting an offer to buy any security in any jurisdiction where the offer or sale is not permitted.
Co-GP FUND
CAPITALIZING A PROPERTY (Example)
| GP Equity(20%) | Catalyst Real Estate GP Fund + Colony Hills Capital |
$2,000,000 |
| LP Equity(80%) | Family Office / PE Firm / Institution | $8,000,000 |
| Debt (70-80%) | Fannie Mae / Freddie Mac | $40,000,000 |
| Total Capitalization | $50,000,000 | |
| GP Equity(20%) | Catalyst Real Estate GP Fund + Colony Hills Capital |
$2,000,000 |
| LP Equity(80%) | Family Office / PE Firm / Institution | $8,000,000 |
| Debt (70-80%) | Fannie Mae / Freddie Mac | $40,000,000 |
| Total Capitalization | $50,000,000 | |
| GP Equity (20%) $2,000,000 Catalyst Real Estate GP Fund + Colony Hills Capital |
| LP Equity (80%) $8,000,000 Family Office / PE Firm / Institution |
| Debt (70-80%) $40,000,000 Fannie Mae / Freddie Mac |
| Total Capitalization $50,000,000 |