Blue Owl Capital has expanded into actual property finance with the acquisition of Prima Capital Advisors for $170m (£134.1m).

Prima is an actual property lender targeted on business mortgage-backed securities that’s majority owned by Stone Level Capital. It manages round $10bn of belongings on behalf of institutional and high-net-worth traders.

Blue Owl additionally introduced that Jesse Hom, beforehand international head of actual property credit score at GIC, will be part of Blue Owl to guide the newly created actual property finance technique and can function chief funding officer for Blue Owl’s actual property platform, reporting on to Marc Zahr, co-president of Blue Owl and head of actual property.

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Blue Owl mentioned Hom will even work to develop the prevailing triple web lease enterprise and determine strategic alternatives to construct out and scale the true property platform.

“This acquisition of Prima represents an extra enlargement of Blue Owl’s suite of capital options, including a differentiated and high-quality actual property lending functionality and additional diversifying our actual property platform,” mentioned Blue Owl co-chief executives Doug Ostrover and Marc Lipschultz. “There’s a rising lack of capital availability in actual property immediately – we imagine that Prima’s sturdy underwriting capabilities and monitor document, mixed with the dimensions of Blue Owl’s ecosystem, can tackle these wants whereas creating enticing risk-reward alternatives for traders.”

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The acquisition is predicted to shut within the second or third quarter of 2024, topic to customary closing situations.

Blue Owl’s acquisition of Prima shall be funded by way of a mix of roughly $157m of fairness and roughly $13m in money. As well as, there’s potential for as much as $35m of earnout consideration within the type of fairness.

Upon closing of the acquisition, Prima workers are anticipated to affix Blue Owl.

“In evaluating the following stage for a way we are able to greatest serve our stakeholders, we recognized Blue Owl because the clear value-driver given the power of their administration staff, their distinctive capabilities and robust tradition of collaboration,” mentioned Prima chief govt Gregory White.

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“I together with Prima CIO Nilesh Patel, CFO Julia Tcherkassova, and the remainder of the Prima staff, are excited to affix Blue Owl and proceed the sturdy legacy we created over the previous three a long time.”

Blue Owl has over $165bn in belongings below administration and invests throughout three multi-strategy platforms: credit score, GP strategic capital and actual property.