Savills Investment Management (IM) has excercised its call option to buy the remaining 75% stake it did not already own in real estate debt manager DRC Capital for up to £65m (€65m).
Savills IM was granted the option in July 2018 when it acquired an initial 25% stake in DRC Capital to help broadened its real estate investment offerings.
The manager is expected to pay an initial £31.3m for the remaining stake as well an additional financial milestone payment of £33.7m in 2024. DRC Capital will operate under the DRC Savills Investment Management brand.
DRC Capital was founded in 2012 by Dale Lattanzio, Rob Clayton and Cyrus Korat. It currently has assets under management of £2.9bn across UK and Europe in a range of senior debt, high yield and whole loan products.
Lattanzio, who has been a member of the Savills IM’s senior management committee since 2018, will continue to lead DRC Capital, with ongoing support from Clayton and Korat and the other members of the DRC senior management team.
Alex Jeffrey, CEO of Savills IM, said: “DRC continues to innovate in the real estate debt market and has rapidly built an enviable position in an increasingly competitive environment.
“We are very happy with the progress of the partnership since 2018 - the combination of Savills IM’s and DRC’s investment teams provides a compelling offering to our clients by providing investment opportunities across the entire real estate capital structure.”
Mark Ridley, froup CEO of parent company Savills PLC, said: “I am delighted to welcome the DRC team into the Savills Group. Their real estate debt expertise will complement our existing equity capability and enhance the group’s services to our global investment client base.”
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