New York–(work wire) – KKR, a leading global investment firm, today announced that KKR has acquired Merchants Mortgage Trust & Corporation, LLC (“MMTC” or “Company”), a mortgage lending platform that specializes in short-term mortgage products for experienced individual residential property investors. . KKR invests in the MMTC through its trusts and private accounts as part of its Asset Based Funding (ABF) investment strategy, which seeks privately-originated investments backed by a diversified portfolio of fixed and financial assets.
MMTC CEO Justin Land, and the current management team will continue to lead the company. KKR’s investment provides MMTC with access to long-term capital to grow its parent business and support expansion of its product offerings, geographic footprint and financing capabilities. As part of this transaction, MMTC will also acquire the outstanding stakes in its subsidiary Orchard Funding.
Founded in 1961 and headquartered in Denver, Colorado, MMTC offers residential bridge loans to private investors that are mostly used for property rehabilitation with a focus on one to four unit residential properties. MMTC operates in developing markets across the western United States with a strong presence in Colorado, Arizona and California. The company’s financing solutions enable community entrepreneurs to improve the quality of residential housing in the United States by investing in renovations and new construction.
The support and long-term capital that KKR provides will accelerate our growth, expand and enhance our ability to meet the financing needs of our clients. We look forward to working with KKR and realizing the benefits this strategic partnership will bring to MMTC and to the entrepreneurs we are proud to fund,” Land said.
MMTC has expanded its lending business significantly in recent years, and in 2021 it created more than $500 million in loans to nearly 500 different borrowers. Through its investments, KKR’s Credit Strategies will gain exposure to a range of direct-generated short-term residential mortgage loans offered to a range of high-quality borrowers.
“By enabling entrepreneurs to invest in residential real estate, MMTC contributes to the long-term resilience of the US housing market, and we are excited to support it through our ABF strategy,” said Daniel Peterzak, Partner and Co-Head of Private Credit. in KKR. “We look forward to working with the company’s talented management team as they continue to grow MMTC’s already strong presence in the marketplace in the United States.”
KKR has deployed more than $5 billion in 49 ABF investments globally since 2016. KKR’s ABF portfolio includes several independently operating private loan creation platforms focused on topics in consumer/mortgage finance, fixed assets, SMEs, and streams contractual cash. KKR has established this lending business in partnership with experienced industry management teams to pursue specific lending markets that the company finds attractive.
The financial terms of the deal were not disclosed.
Hovde Group and Wells Fargo acted as financial advisors to MMTC and Otteson Shapiro LLP and Hunton Andrews Kurth served as legal advisors. Sidley Austin LLP has served as legal counsel to KKR.
About Merchants Mortgage Trust & Corporation
Merchants Mortgage & Trust Company, LLC is a real estate finance company that creates and finances residential mortgages primarily to private investors purchasing 1 to 4 family homes. Founded in 1961 and headquartered in Denver, Colorado, Merchants primarily operates in the developing markets of the western United States. Merchants provide a range of products to their customer base including bridge, leasing and construction loans. The company focuses on providing an outstanding product to its customers with high levels of customer service, fast financing and competitive prices.
KKR is a leading global investment firm providing alternative asset management, capital markets and insurance solutions. KKR aims to achieve attractive investment returns through a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors mutual funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurers offer retirement, life and reinsurance products under the management of the Global Atlantic Financial Group. References to KKR investments may include the activities of funded funds and affiliate insurance companies. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit the KKR website at www.kkr.com and on Twitter KKR_Co.