ENGLEWOOD CLIFFS, NJ-Procida Funding LLC has "The 100-Mile Fund," a short-duration real estate investment fund that will provide capital to builders and real estate operators within a 100-mile radius of New York City. The fund's target is to raise $25 million, which with leverage and strategic partners, should result in approximately $100 million in loans.
The goal is to serve a market of smaller owners that has been ignored by other commercial lenders, Billy Procida, president of Procida Funding, tells GlobeSt.com. Loans generally will be made in the $5 million to $10 million range, although the occasional $2 million deal could be made, holding the B portion of the debt.
“This is for what I call situational opportunities,” Procida says. “We go in and give them a way to pay off the bank. I am doing yeoman’s work that America needs, and no one is servicing the $5 million to $10 million market.”
That’s also why the fund, which will be shut down by the end of 2013, will only invest close to home. In fact, it’s a microcosm of what Procida calls Plan 100, an economic recovery outline that he has proposed to President Obama in an open letter on YouTube since 2008.
“Give 100 guys $100 million to put to work within 100 miles of their offices,” Procida says. “I’m not going to screw up within 100 miles of my office. And every deal I’m doing will remove an eyesore from the neighborhood.”
The new fund is the third launched by Procida in his career, but the first for Procida Funding. In 2002, with a prior company, he was the founding partner and seed investor for the Palisade Regional Investment Funds 1, followed by Palisade Regional Investment Funds 2 in 2004. When a non-compete agreement expired earlier this year, he began working on the new fund. Procida has been a seed investor in all of his funds. “Everything is about timing in this business,” Procida says.
The Englewood Cliffs, NJ-based firm has already completed $100-million in loan activity this year. Recent closings include providing a $4.25-million condo inventory loan at Gull's Cove in Jersey City; a $3.6 million loan to buy and renovate a partially completed apartment building in Union City, NJ; a $4-million loan on the Freehold Commons in Freehold, NJ; and a $3.5-milllion loan to acquire a defaulted mortgage on the Ocean Walk condominiums in the Belle Harbor section of Queens, NY.
“Based on this being my third fund after 30 years in the business,” Procida says, “I’ve got it figured out a bit.”
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