Falcon Real Estate Investment's Miller

Who says no one is looking to buy properties in this economy? New York City-based Falcon Real Estate Investment Co. has started a new “US Opportunity Fund” that is targeting “the most promising and lucrative commercial properties within the US market,” according to a company statement. The fund, made up primarily of foreign investors, is set to close in June and will target distressed assets. Other than acquiring properties outright, Falcon plans to team up with overleveraged investors and expects a 16% internal rate of return. GlobeSt.com recently spoke with Jack Miller, the president of Falcon Real Estate, about the fund’s scope and goals.

GlobeSt.com: Are there any particular property sectors that your fund is targeting?

Miller: We’re not looking at hotels or the big-box retail sites. Our primary focus, based upon talking with clients and potential clients, is that there seems to still be a flight to quality in terms of asset characteristics and location. Two years ago, some of our clients wanted us to chase yields by going to smaller markets and less desirable properties with “B” tenancies. There’s been a divergence in appetite to the class “A” properties, and everything else has been left behind.