"The investment achieved its objectives, yielding approximately 14% annually to the partnership," says Ned H. Cohen, vice president of Wien & Malkin Securities Corp. "Investors in this first Strategic Capital partnership have received an overall return of 13.4% on fully invested funds."

Mr. Cohen says this is the last redemption of the SC I program. SC I capital from Redwood Tower is being distributed to investors rather than reinvested because the yield objectives of the first partnership are not attainable in the current investment environment.

"We are still working with the on-going Strategic Capital program through SC II and SC III and are hopeful that they will provide superior current returns," he says. "But the marketplace for mezzanine-type financing is more competitive today, so expectations have to be lowered somewhat."