PhillyDeals: Two leave Capmark to start new firm

As Capmark Financial Group Inc. heads toward possible bankruptcy, or a sale to Warren Buffett's Berkshire Hathaway Corp., or both, investment pros have been leaving the Horsham-based commercial-property investment firm to set up their own shops.

Scott Roth and Patti Unti, who together headed Capmark's Commercial Mortgage-Backed Securities (CMBS) team, have started a new firm, Ventras Capital Advisors L.L.C., to manage $5 billion in Capmark's former real estate investments and, they hope, set up new funds.

Ventras is owned by Unti, Roth, and buyout firm MBH Enterprises, of Denver, which financed their purchase of Capmark's investment- management contracts. They're starting with five other ex-Capmark employees and plan to hire more people to manage "distressed" real estate, Roth told me.

Unti and Roth joined Capmark when General Motors Corp. owned it in 1997. Their careers span the boom and bust in CMBS, which grew rapidly as a way for investors to spread their risk among different types of properties, but stalled as property prices fell after 2006. They say their skills are still in demand - by big institutional investors who need to value the properties they still own, and by bargain-hunters.

Ventras is moving to the Mellon tower in Center City, five minutes from Roth's home, "because I lost the coin toss," Unti told me. Also, because they plan to expand, Center City is more "interesting" than the suburbs as an investment center, and Mellon is "just an hour from New York by Acela train," Roth said.

Separately leaving Capmark: executive vice president Jacqueline Brady and senior vice presidents Margaret Blakey and Brent Morris, with five support staff. They're joining the Urdang investment-management unit of Bank of New York Mellon Corp., working from offices in Plymouth Meeting and New York.

Capmark previously spun off Realpoint L.L.C., its commercial real estate credit-rating division. It has grown rapidly as investors seek alternatives to Moody's Investors Service and other ratings firms that failed to predict the collapse.

Spokeswoman Joyce Patterson said Capmark had no comment on the executives' departure. The firm still employs about 585 at its Horsham headquarters.

"Right now [the U.S. has] too much of everything. Too many hotels. Too many offices. Too many apartment buildings," says Jeffrey Rogers, president and chief operating officer of real estate adviser Integra Realty Resources Inc., based in New York, with offices in Philadelphia and other cities.

Capmark's potential bankruptcy "is a symptom of what's happening in commercial real estate," Rogers told me. "Something like $1.5 trillion in [commercial real estate] loans are coming due in the next year. There's only about $300 billion in real estate investment funds" to help refinance it.

And yet: "This is the best time to buy commercial real estate," Rogers claims. How is that possible? Because prices are down, and interest rates are low. "If you're forward-thinking, this is the market you're buying in," Rogers said.

The investment bankers' confab and trade show known as M&A East, cosponsored by the Association for Corporate Growth, hit the Convention Center yesterday.

Thomas Bonney, boss at Old City-based CMF Associates L.L.C. financial advisers, warned of the lousy deal climate last year. Yet, after Bonney hosted 80 investment pros at Mint on Second Street last night in an opening reception, he told me their mood was "buoyant." And not just because he filled them with his own Leblond-brand rum (and Manayunk-brewed Yards beer).

Sellers are accepting lower prices. Funds "are putting more private equity up" as firms "reposition" from stressed old businesses into more promising models.

Examples? "Look at Comcast-NBC," Bonney said. "That's a repositioning move." And Blackstone Group L.P. is ready to sell a string of companies on the stock market, he added.

What are deal-makers still worried about? The long debate over health care: "The unintended consequence of all this noise in Washington about health care, it's slowing down investment in the one area people were most interested in," Bonney explained. "They have to fix the rules."