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Deerfield Triarc Looks Beyond MBS

CHICAGO-The fledgling structured mortgage REIT hopes to have more than 40% of its portfolio in investments outside the mortgage-backed securities within the next 18 months.

By Mark Ruda | Updated on May 17, 2006

(To read more on the debt and equity markets, click here.)

CHICAGO-Deerfield Triarc Capital Corp. hopes to increase its allocation of investments outside mortgage-backed securities to more than 45% over the next 12 to 18 months. Those “alternative assets” are expected to generate higher returns than the residential or commercial mortgage-backed securities, company officials say during their earnings conference call this week.

The company’s RMBS portfolio increased 15.6% to $8.1 billion in the first quarter, compared to $820.2 million in alternative investments, according to Deerfield Triarc Capital’s earnings report. However, the structured mortgage REIT has the ability to tap $300 million from Wachovia Bank to increase investments in senior corporate debt, preferred stock and other investments. “It has the ability to do some real estate also,” says chief financial officer Richard Smith. “I anticipate that over time, we’ll find some real estate opportunities to take advantage of.”

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