Strategic Capital V, L.P. (SC V) has made its first close at just over $35 million, to allow it to continue to provide senior equity and subordinate debt to real estate entrepreneurs with special situation or deleveraging needs. Originally targeted to raise $30 million, the fund was quickly oversubscribed.

"This is the fifth partnership in the Strategic Capital series and each successive fund has proved out our model for performance and, as a result, attracted more capital than its predecessor," observes Ned H. Cohen, Executive Vice President of Wien & Malkin Securities Corp. "We have investments already made and about to be made, so instead of extending the subscription period, we chose to close the fund now and invest. If we find opportunities quickly, we will conduct a second closing, as we did with Strategic Capital IV, to raise additional capital."

The SC program has consistently produced solid current returns for Wien & Malkin investors without additional leverage. Besides making short and medium-term loans and preferred-equity investments, the program also has purchased existing high-quality mezzanine debt at discount. It is quite possible that clearing up banks' balance sheets or assisting borrowers who must reduce their debt outstanding, because of banks' needs to reduce real estate debt exposure, will be a new and larger source of business going forward for SC V.

Mr. Cohen says Strategic Capital remains opportunistic, "to serve as a direct source of debt or equity for real estate entrepreneurs who need replacement or supplemental financing, or to buy other loans already originated at a discount to generate a good return for our investors."