Institutional Investment

Institutional Investment

Overview

For over 45 years, Cox, Castle & Nicholson has represented a wide variety of institutional investors including pension funds, endowments, and sovereign wealth funds in real estate transactions with a particular emphasis on public pension funds. We have an established team of attorneys who are sensitive to the issues and concerns of institutional investors in their investment activities. Many of the members of our Institutional Investor Practice have spent virtually all of their legal careers providing legal services to institutional investors in connection with their real estate investments. In addition, we work closely with the firm's other specialized attorneys, such as those in the Tax, Environmental, and Land Use Practices, all of whom are well-versed in the particular areas of concern to institutional investors. Our familiarity with market terms and provisions, as well as the results institutional investors are typically able to achieve, allows us to negotiate and structure transactions efficiently and effectively.

Because of the broad, current experience of our attorneys, we are uniquely qualified to represent institutional investors in all aspects of their real estate investment activities, including acquisitions and dispositions of single properties, portfolios, and entity interests; joint ventures for both single projects and platform vehicles involving all property types; co-mingled funds (including international funds); subscription financing; conventional real estate financing; loan modifications and workouts; loan assumptions; entity selection and formation; investment management agreements; easements; broker agreements; land development; and property management. We routinely work with the investor's in-house counsel, investment committees and boards, as well as the client's advisors and consultants. We understand the relationship between the investor, in-house counsel, its advisors, consultants and outside counsel, and we know how to work efficiently and effectively with the investor and all of its various service providers.

Acquisition, Disposition, Title Insurance, Leasing, Development And Environmental

We have handled all aspects of general real estate transactions for institutional investors, including acquisitions, dispositions, leasing, development, and property management activities for all real estate product types including apartment, commercial, retail, and industrial properties as well as raw land, hotels, and other non-core assets, including multi-state and multi-property transactions. We are very familiar with a wide variety of real estate transaction structures and contract provisions, and are capable of addressing all due diligence issues, including title issues, easements and covenants, conditions and restrictions, land use entitlement, and environmental issues, and have the experience to negotiate acceptable resolutions to these issues to enable the transactions to proceed to the satisfaction of the client.

Co-Mingled Funds, Including Debt Funds, Infrastructure Funds And International Funds

We have represented numerous public pension funds in over 300 domestic and international (including emerging markets) commingled funds structured as limited partnerships, limited liability companies and REITs, including both "closed end" funds and "open end" funds, covering a wide range of products, including distressed debt, office, retail, and domestic and international housing and infrastructures, ranging in size from small emerging market funds to large funds reaching in excess of $3 billion dollars in capital commitments. We have represented institutional investors on all aspects of their investments, including the review and negotiation of the fund documents, preparation of side letter agreements, and negotiation of investor letters and legal opinions delivered by the institutional investor to fund subscription lenders. As a result of our extensive exposure to a wide variety of commingled funds and our experience negotiating fund documents with a wide range of fund sponsors, we are intimately familiar with what constitutes "market" terms and provisions and what other institutional investors are able to achieve in similar negotiations. We are also experienced in negotiating the rights of investors to participate on advisory boards of commingled funds, and in assisting the client representative in the decision-making obligations associated with participation on advisory boards.

Joint Ventures And Other Co-Investment Vehicles

We have extensive experience negotiating joint venture transactions between institutional investors and real estate developers and operators across a variety of property types and geographic regions. These transactions include both "programmatic" or "platform" vehicles pursuant to which the venture invests in multiple properties over the life of the venture, as well as single transactions for the development, ownership, and operation of specific projects. The ventures include all product types, including all core categories, as well as economically targeted investments, such as investments in historically underserved communities. We routinely negotiate specialized provisions for joint ventures, including "for cause" and "without cause" removal options, as well as buy-sell and buyout provisions, so that our pension fund investor clients have a range of alternatives to address concerns that may arise during the term of the venture. We also frequently negotiate the terms of permissible leverage for the venture, as well as the financing documents between the venture and third party lenders. We are skilled at addressing management issues that are often the subject of intense negotiation in ventures, including defining permissible investments, which can include limitations to investments "within the box" or to specific target markets. We also address potential conflicts of interest between the members of the venture.

Joint Venture Dissolution And Removal Of Co-Mingled Fund Sponsors

We have represented institutional investors in the unwinding of joint venture relationships, both through processes of negotiation and the enforcement of buy/sell provisions. We have also represented individual institutional investor limited partners, and groups of limited partners, in the removal and replacement of co-mingled fund sponsors through negotiation, with the concurrent evaluation and advice regarding triggering the "for-cause" removal provisions if the negotiations faltered.

Financing Transactions

We routinely represent public pension funds in the negotiation, documentation, and closing of a wide variety of financing transactions. Our Finance Practice includes experience in virtually all lending structures, including loans with both income and equity participation features, convertible mortgages, guaranteed yield loans, multi-state, multi-parcel, and cross-collateralized/cross-defaulted loans, revolving lines of credit, as well as other exotic structures. We are experienced in debt structuring (both new and refinance), including guaranty obligations, and other issues of particular concern to public funds. Because of our experience in commingled funds, we are experts on subscription credit facilities, and the accompanying investor letters and legal opinions required by subscription facility lenders.

Investment Management Agreements

We are very experienced in documenting and negotiating investment management agreements between public pension funds and their investment advisors and consultants. We have prepared and negotiated both the initial arrangements and the renewal of existing agreements between a number of public pension funds and their advisors. We have also revised the structure of investment management agreements to meet the public pension funds' specific needs better, including adding flexibility regarding modification of deal specific issues and tailoring the compensation structure based on specific deal parameters, without the need to modify the entire investment management agreement. Our experience extends across a number of different public pension funds and a variety of advisors, which allows us to assure our public pension fund clients regarding market terms for such arrangements.

Special Opportunity Investments And Private Equity Transactions

In addition to traditional transaction structures, we have represented institutional investors in unique transactions that are on the forefront of investment activities and have represented public pension systems in significant investments in private equity funds.

Representative
Matters

<h3> Acquisition, Disposition, Title Insurance, Leasing, Development And Environmental</h3>

Represented a public pension fund in the acquisition of a $78 million retail center in Louisville, Kentucky, as well as the concurrent negotiation of a complex construction easement and escrow agreement for post-closing development by seller on property acquired by buyer.

Represented a pension fund in the indirect acquisition of a retail development parcel in Maryland and negotiated a related investment agreement, contribution and assignment of interest agreements, property management agreement, and development services agreement. Also conducted all title and environmental due diligence.

Coordinated all title and survey due diligence and a two stage closing of the acquisition of over 70 industrial properties in 16 states.

Represented a pension fund in the sale of a $170 million apartment and retail complex in Santa Monica, California, which included the negotiation of an assumption and release agreement in connection with the buyer's assumption of the existing financing.

<h3> Co-Mingled Funds, Including Debt Funds, Infrastructure Funds And International Funds</h3>

Represented an institutional investor in the formation and maintenance of a separate investment vehicle capitalized with $500 million, and its subsequent investments in an emerging markets investment program in residential, office, retail, and industrial real estate investments in diverse locations such as China, Brazil, Colombia, Mexico, Perú, and Uruguay, which included the review and negotiation of the partnership agreement, side letter, subscription agreement, and documentation provided to lenders to the fund.

Represented an institutional investor in its $500 million investment, and concurrent $900,000 co-investment, in a large, open ended commingled fund investing in domestic and international infrastructure investments, including airports, ports, renewable power, and energy facilities.

<h3> Joint Ventures And Other Co-Investment Vehicles</h3>

Consolidated a large institutional investor's entire core multi-family apartment portfolio under a single partner, documenting a $205 million commitment to the venture. The new venture included 57 apartment communities with 14,674 units in 13 states with a net asset value of approximately $1.8 billion.

Advised a large public fund in the formation of three joint ventures and the concurrent acquisition of 71 industrial properties in 16 states valued at $800 million, including coordinating the assumption of existing debt, the release and reconveyance of other debt, environmental, title, survey, and contract review and coordination of local counsel in each of the 16 states where the property was located.

Represented an institutional investor in structuring, negotiating, and documenting a series of strategic joint venture relationships with an international real estate services company for the acquisition and development of residential, industrial and office properties in Latin America.

Implemented the Real Estate Strategic Plan for a large California pension fund, including negotiating the relationships between the fund and partners in the core investment areas of industrial, retail, multi-family, and office.

Represented an institutional investor's interests in the unwinding of a joint venture, resulting in the division of more than 60 properties valued in excess of $1 billion dollars, the formation of three joint ventures and the concurrent acquisition of 32 industrial properties in California, valued at $558 million dollars, together with the assumption of two loans totaling more than $170 million dollars, the release and reconveyance of other debt, environmental, title, survey and contract review, and modification of the advisory agreement with the pension fund's advisor to address the new properties.

<h3> Joint Venture Dissolution And Removal Of Co-Mingled Fund Sponsors</h3>

Represented an institutional investor's interests in the unwinding of a joint venture, resulting in the division of more than 60 properties valued in excess of $1 billion dollars, the formation of three joint ventures and the concurrent acquisition of 32 industrial properties in California, valued at $558 million dollars, together with the assumption of two loans totaling more than $170 million dollars, the release and reconveyance of other debt, environmental, title, survey and contract review, and modification of the advisory agreement with the pension fund's advisor to address the new properties.

<h3> Financing Transactions</h3>

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Represented a public pension fund in obtaining $18,850,000 loan secured by high-rise residential building located in Texas.

Special Opportunity Investments And Private Equity Transactions

Represented a large institutional investor in its $600 million investment in a venture specializing in buying foreclosed homes and holding them for investment as rental properties, a unique transaction formulated to take advantage of current market conditions.

Represented all of the institutional limited partners in two co-mingled funds with assets in Mexico in the conversion of their interests in the funds by a roll up of the assets and the contribution of those assets to one of the earliest REITs formed in Mexico.

Represented a public pension fund in connection with the issuance of a new fund series in an existing private equity company that invests in or alongside domestic and international private equity funds pursuing a variety of investment strategies.

Attorneys &
Paralegals

Name Title City Phone  
Kinigstein, Kevin S. Partner Los Angeles 310.284.2191
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Kuhl, John H. Partner Los Angeles 310.284.2267
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Migita, Gail S. Associate Los Angeles 310.284.2215
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Snyder, Douglas P. Partner Los Angeles 310.284.2253
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Trott, John Matthew Partner Los Angeles 310.284.2299
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Wells, Amy H. Partner Los Angeles 310.284.2233
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