Pal fund keeps investors happy with 13.4% return.Investors in the Palisades Palisades, cliffs along the west bank of the Hudson River, NE N.J. and SE N.Y., extending from N of Jersey City, N.J., to the vicinity of Piermont, N.Y., with a general altitude of from 350 ft to 550 ft (107–168 m). Regional Investment Fund I enjoyed a 13.4 percent return in 2005. In addition to the 13.4 percent, there are unrealized gains Unrealized Gain A profit that results from holding on to an asset rather than cashing it in and using the funds. Notes: Let's say you own a stock that has doubled, but you haven't sold it yet. This is said to be an unrealized gain. of 11 percent in the portfolio. This total return was well ahead of benchmarks such as the REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). index, the NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on and the fund's targeted return. The fund, which is closed to new investors, avoided high-risk opportunities that might have yielded a greater return because the market and the business climate was not right for such risk, William "Billy" Procida, principal of Palisades Financial, which manages the private fund, told shareholders at their annual meeting. Procida also told shareholders that Palisades Financial's second fund, Palisades Regional Investment Fund II, is accepting investments--both new money and money rolled over from the first fund--toward its $200 million goal. Like the first fund, Fund II will invest in first mortgages, mezzanine loans A mezzanine loan is a relatively large loan, typically unsecured (ie., not backed by a pledging of assets) or with a deeply subordinated security structure (e.g., third lien on the property but non-recourse vis-a-vis the borrower). and equity positions, but will also look to buy distressed debt distressed debt Debt with low junk status and a market price substantially below par value, often pennies on the dollar. Investors sometimes buy distressed debt on the possibility that management can renegotiate loan agreements and keep the issuer out of as that product becomes more readily available. Investors in Fund I saw their money earn 13.4 percent realized gains--net of expenses--largely on the backs of successful debt positions in real estate and related business opportunities. Among the investments that the fund made were a nearly $3 million first mortgage to Malmstrom of Colts Neck, N.J., which was paid off in March; $1.3 million first mortgage to Industrial Rivet of Northvale, N.J., which was paid off in March; a $2.5 million mezzanine loan to Sea South Holdings of Toms River, N.J., which was paid off in June and; a $4 million secured corporate loan to CMB Noun 1. CMB - (cosmology) the cooled remnant of the hot big bang that fills the entire universe and can be observed today with an average temperature of about 2. Additives, which has offices in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , Kentucky and Louisiana. That loan was paid off in September. "These transactions are indicative of the type of business and real estate deals where we are looking either to take an equity or debt position," said James F. Calvano, who became Palisades Financial's chairman in 2005. "As always, we're looking to maximize return but minimize risk, and wherever and whenever we see value, we want to participate. That was true of the first fund and will certainly be true--but in larger numbers, given that we're a bigger firm now and the raise will be larger--of the second fund." Procida added: "Our niche is finding deals between $1 million and $10 million that are time-or credit-sensitive, complex and structured, which involve borrowers with good strategies and properties but who are, for some reason, not quite ready for traditional lending institutions." Procida also noted that New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. fireman Jim Kennelly, who does development projects as a second career, and Kent Swig, each closed loans with Palisades Financial, each for the fourth time in three years. "We're particularly proud of that," he said. "The fact that we get repeat business is a testimony to how we treat our clients, service them and their loans, and meet their needs." |
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