New York-based North River Investment Management, a manager of private equity funds that seek to invest in financial assets in the commercial real estate sector, has launched its first commercial real estate private equity fund, North River Opportunity Partners I, with USD100m of committed capital.

The fund will pursue investment strategies designed to capitalise on opportunities created by turmoil in the global credit markets. Initially, the fund will buy discounted pools of commercial mortgage debt and originate first mortgage and mezzanine loans on high-quality commercial real estate properties.

'Our team sees enormous potential to create long term value from the massive dislocation in the credit markets,' says North River co-founder Jonathan Kaye. 'Current economic pressures have led to wide-scale devaluations of assets such as commercial mortgage-backed securities. At the same time, due to capital constraints, many traditional lenders have retreated from commercial mortgage financing, even for highly credit-worthy properties.'

'To seize these opportunities, we have devised a strategy that is flexible enough to allow us to either acquire or originate quality commercial real estate-oriented financial assets, while actively enhancing the value of those assets. We view this as the first step in creating a long-term platform for investment in the commercial real estate capital markets.'

The fund is managed by a team of commercial real estate underwriters, lenders and investors. Kaye is a 20 plus-year veteran of the commercial real estate finance industry who was previously an executive managing director of GMAC Commercial Mortgage Corporation, co-founding the firm's New York-based securitised finance and structured debt business and establishing its London-based European debt operations. He earlier worked for Lehman Brothers, Manufacturers Hanover Trust and Chemical Bank.

Avery Egert, a principal and co-founder of the fund and a member of its investment committee, is president and chief executive of the Sovereign Group, which owns and operates a real estate portfolio comprising 15 million square feet of properties across the US, ranging from class A office building to industrial parks.

Jason Shukofsky, a partner in the fund, was most recently a senior vice-president and head of underwriting at Capmark Finance, as GMAC is now known, where he managed an underwriting team of 25 professionals, having begun his career at PaineWebber Real Estate Securities.

Richard Cadigan, another partner, is an attorney with 10 years experience in structured finance. Before joining North River, he was the manager of the transaction management team responsible for structuring fixed and floating-rate loans at Dillon Read Capital Management, a hedge fund manager owned by UBS, and he earlier also worked at GMAC.