CSV Capital launches $500m loan acquisition fund.

The Carlton Group's Chairman Howard L. Michaels announced that Carlton Strategic Ventures, LLC, the principal transaction group of Carlton, has formed a new joint venture with a major insurance company to acquire performing discounted loans and originate and provide "low cost" mezzanine and preferred equity loans on a principal basis. The venture is called CSV Capital, LLC.

CSV Capital intends to continue purchasing discounted mezzanine loans, B-Notes, participation interests, mortgage and mezzanine whole loans and preferred equity interests in performing assets secured by real estate located in major markets across the country.

CSV's new fund is backed by a major insurance company and its goal is to take advantage of the current credit dislocation and achieve above average returns for itself by acquiring existing performing real estate assets at a discount.

CSV Capital has a competitive advantage over other "vulture" distressed and opportunistic funds currently in the market due to its lower cost of capital and its affiliation with a major insurance company. CSV Capital's lower cost of capital will enable it to purchase assets at a lower yield than its competitors while still being able to achieve its targeted returns.

CSV has already acquired over $300 million in secondary market b-note, mezzanine and preferred equity loans in 10 stand alone transactions and has a great deal of experience in pricing, underwriting and quickly closing these types of investments.

The new CSV venture intends to invest over $500 million in secondary mezzanine loan, B-Note, and preferred equity acquisitions and new mezzanine and preferred equity originations. CSV

Capital intends to be fully invested over the next 12 months, stated Carlton Chairman Howard L. Michaels.

The acquisition parameters of CSV Capital are as follows:

The purchase of loans ranging in amounts from $25 to $50 million per individual transaction, and up to $150 million per transaction for large portfolios; All asset types (except hotels will only be considered if included in a portfolio of diverse assets) 65% to 85% market adjusted LTV for last dollar invested; Mostly floating rate loans but will consider purchasing fixed rate loans with maturities no greater than 10 years

Michaels along with partner, Michael J. Campbell, recently hired former Bear Stearns director, Dax Scharfstein and five other senior investment bankers and analysts will be the principal executives originating, underwriting and executing the Fund's business.