IWC Capital Management aims to raise at least US$5 million (J$432 million) in December on the private placement market to fund purchases of undervalued real estate in New York, according to the deal's lead broker and arranger, Mayberry Investments.
IWC expects to raise this capital for its IWC Opportunity Fund I which aims to buy small to middle market residential and commercial properties of up to US$10 million in value, primarily located in Brooklyn.
"The current softness in the US housing market has created a compelling opportunity for Jamaican investors seeking US dollar income generating assets with capital appreciation upside," IWC head Matthew Wright said in a statement Monday. Wright is a former vice-president in the Infrastructure Finance Group of Citibank Global Capital Markets in New York.
Jamaica Money Market Brokers (JMMB) will be the selling agent for the private placement.
IWC Opportunity Fund was launched in Kingston in August at a forum organised by VM Wealth.
The parties did not respond to requests for clarification on why VM was not a part of the team arranging the current placement.
Mayberry, which has had a series of successes on junior market IPOs since 2009, trumpeted its selection for the placement as testimony to its expertise as a deal arranger.
"What you see now is that in a low interest rate environment, investors are seeking our expertise in structuring deals that will enable them to grow their portfolios," said CEO Gary Peart.
"As the number of deals grow and the opportunities expand, we decided to look to partner with JMMB and work with them to give as many Jamaicans the opportunity to be a part of the capital markets," he said.
IWC wants to raise up to US$83 million (J$7.2b) over time — a maximum US$25 million from equity, and US$58 million of debt, according to the IWC Opportunity Fund I term sheet.
The fund aims for an above 18 per cent average annual return on equity.
IWC was established in December 2009 in response to attractive opportunities for investments in the US real-estate market created by the downturn in the US housing market and economy which began in 2007, said the company's term sheet.