CLAYTON — Global investment company BlackRock Inc. is aiming to acquire a Clayton commercial real estate firm, the companies announced Monday.
The deal to buy ElmTree Funds, which has $7.3 billion in assets under management, will boost New York-based BlackRock’s move into the private credit market, or financing made by non-bank lenders, according to a release.
ElmTree will work alongside private credit investor HPS Investment Partners on BlackRock’s new private financing solutions arm.
“ElmTree has the team, expertise, and relationships that will help drive growth and deliver differentiated investment solutions,” Scott Kapnick, chairman of BlackRock’s private financing solutions, said in a statement.
Longtime real estate executive Jim Koman started ElmTree in 2011. His firm focuses on commercial real estate, primarily build-to-suit industrial properties. Its holdings span 31 states.
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“The opportunity to work with world-class organizations like HPS and BlackRock was just too good to pass up, creating a synergy for ElmTree that we couldn’t replicate with other global partners,” Koman said in a statement.
ElmTree is expected to be paid in stock with the potential for additional compensation pending the firm’s performance over the next five years, according to a release. Additional financial terms of the deal were not disclosed.
Most recently, ElmTree developed and built Clayton’s newest office buildings, which are home to industrial technology giant Emerson, manufacturing technology firm Barry-Wehmiller Cos. and Midwest BankCentre.
Skadden, Arps, Slate, Meagher & Flom, Fried, Frank, Harris, Shriver & Jacobson, and Sidley Austin LLP serve as legal counsel to BlackRock and HPS.
Goldman Sachs & Co. served as financial advisor to HPS. Berkshire Global Advisors served as financial advisor and Kirkland & Ellis LLP served as legal counsel to ElmTree Funds.
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