Wrightwood Capital Goes Back to the Future: A Chicago-Based Commercial Real Estate Finance Firm Has Deep Roots in the Business and Ambitious Plans for Growth

Bell, John, Mortgage Banking

Bruce Cohen, chief executive officer of Chicago-based Wrightwood Capital, has an unconventional but clear formula for success: going back to the future. [??] How well that works is reflected in the vigorous growth of the firm, a leading provider of structured capital to the real estate industry. Wrightwood is on target to do $1.3 billion in first-mortgage financing in 2006 compared with $760 million in 2005, according to Cohen. In addition, the 2006 slate calls for $200 million in net lease acquisitions, mezzanine or preferred-equity investments. For 2007, the financing volume is projected to reach $1.8 billion. [??] Moreover, the firm maintains a rock-solid foundation--a $2 billion balance sheet of permanent capital. Cohen says few privately held firms have that level of capital availability. "We're the best-kept secret in the real estate industry," he says. [??] "We're institutionally capitalized, but very entrepreneurial in the way we do business. Our ability to deliver highly tailored, highly flexible entrepreneurial capital to the industry represents real value to our borrowers," says Cohen. [??] The back-to the-future component of the firm's game plan derives from the fact Wright-wood is adopting the business model of a predecessor. Yet it is tailoring that model to the new realities of the current real estate financing marketplace.

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Adopts Heller business model

The model being emulated is the Heller Real Estate Finance Division of former Chicago-based financial services giant Walter E. Heller & Co., acquired by Fairfield, Connecticut-based General Electric Co. (GE) in 2001.

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Cohen explains, "While we're replicating that model, we're also reflecting the dramatic changes taking place in the real estate capital markets. That includes the migration of capital delivery from banks and life companies to niche providers like ourselves."

He defines the model as delivery of an array of structured capital to the market, including bridge, construction, mezzanine, preferred-equity and joint-venture capital tailored to the particular needs of the clients.

Thomas Jaekel is Wrightwood's managing director and chief investment officer, who was president of Heller Real Estate Finance from 1990 to 1994, prior to joining Wright-wood. He defines the basic elements of the model as attracting and retaining the best people. …

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Publication information: Article title: Wrightwood Capital Goes Back to the Future: A Chicago-Based Commercial Real Estate Finance Firm Has Deep Roots in the Business and Ambitious Plans for Growth. Contributors: Bell, John - Author. Magazine title: Mortgage Banking. Volume: 67. Issue: 4 Publication date: January 2007. Page number: 82+. © 2009 Mortgage Bankers Association of America. COPYRIGHT 2007 Gale Group.

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