The company can tap into $500 million to co-invest, thanks to "some of our institutional equity that's still there, waiting patiently," says Chalme. "It would be a co-investment with the lenders, because who's going to pay for TI? Certainly not the sponsors if they're out of the money."

Chalme sees the opportunities for this new division increasing as the current market evolves. "As foreclosures happen, as mezzanine pieces get bought up, or legacy assets get bought, possibly with some of this PPIP everybody's been throwing around, you will see a changing of the guard on the operation and sponsor side of these assets," he says. "You've had a lot of amateurs on the field, and the interests weren't always aligned."

During the up cycle of easy credit and quick flips, "a lot of people were not focused on operations," Chalme says. "That was secondary to owning an asset. Now, everybody's gone back into the think tank to figure out what happens with these assets when you have downward pressure on the rents. You have situations where the sponsors are basically out of money, and so you have distress. The problem is that it takes a while for that to work through the system. In the interim, who's really watching the ship here?"

He adds, "If you have an operator who has 10 different deals and most of them are okay while four are under water, he's focusing on the ones that are okay or trying to make out which ones aren't. Either way, often he doesn't have much skin in the game. The senior lender obviously has rights to say what management is in place when the assets aren't performing, and we see a lot of opportunities to come in and take a look and see what we can do."