Blue Owl Capital Expands into Real Estate Finance with Acquisition of Prima Capital Advisors

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Apr 09, 2024, 07:00 ET

GIC's Jesse Hom to join Blue Owl as Head of Real Estate Finance

NEW YORK, April 9, 2024 /PRNewswire/ -- Blue Owl Capital Inc. ("Blue Owl") (NYSE: OWL), a leading alternative asset manager, announced today the creation of Blue Owl's Real Estate Finance strategy with the acquisition of Prima Capital Advisors ("Prima") for the aggregate consideration of $170 million. Prima manages approximately $10 billion in assets on behalf of institutional investors and select high net worth individuals. The acquisition is expected to close in the second or third quarter of 2024, subject to customary closing conditions.

Prima, founded in 1992 by Gregory White, is a real estate lender focused primarily on investing in commercial mortgage-backed securities. Prima is majority owned by Stone Point Capital LLC ("Stone Point"), an alternative investment firm based in Greenwich, Connecticut. Blue Owl's acquisition of Prima will be funded through a combination of approximately $157 million of equity and approximately $13 million in cash, subject to certain closing consideration adjustments. In addition, there is potential for up to $35 million of earnout consideration in the form of equity. Upon closing of the acquisition, Prima employees are expected to join Blue Owl.

Blue Owl also announced that Jesse Hom, previously Global Head of Real Estate Credit at GIC, will join Blue Owl to lead the newly created Real Estate Finance strategy and serve as Chief Investment Officer for Blue Owl's Real Estate platform, reporting directly to Marc Zahr, Co-President of Blue Owl and Head of Real Estate. In addition to launching Blue Owl's Real Estate Finance strategy, Hom will work to grow the existing triple net lease business and identify strategic opportunities to build out and scale the Real Estate platform.

Blue Owl Co-CEOs Doug Ostrover and Marc Lipschultz said: "This acquisition of Prima represents a further expansion of Blue Owl's suite of capital solutions, adding a differentiated and high-quality real estate lending capability and further diversifying our real estate platform. There is a growing lack of capital availability in real estate today – we believe that Prima's strong underwriting capabilities and track record, combined with the scale of Blue Owl's ecosystem, can address these needs while creating attractive risk-reward opportunities for investors. Today's announcements underscore how we think about strategic inorganic growth at the investment platform level. Marc Zahr and his team built a leading triple net real estate business that will become even more comprehensive and compelling with the addition of Prima's debt capabilities."

Co-President of Blue Owl and Head of Real Estate Marc Zahr said: "I have had the pleasure of knowing Jesse for years and can say he is one of the most well-respected, thoughtful and experienced real estate credit investors in the industry. I am confident that he, along with the outstanding team at Prima who maintain a 30-year track record of success, will further bolster our Real Estate platform's value proposition."

Jesse Hom said: "The opportunity to build on the tremendous success of both Blue Owl and Prima to create a dedicated real estate finance strategy is a unique and exciting prospect. I am grateful to GIC for 15 amazing years and looking forward to starting this new chapter in my career."

Prima CEO Gregory White said: "In evaluating the next stage for how we can best serve our stakeholders, we identified Blue Owl as the clear value-driver given the strength of their management team, their exceptional capabilities and strong culture of collaboration. I along with Prima CIO Nilesh Patel, CFO Julia Tcherkassova, and the rest of the Prima team, are excited to join Blue Owl and continue the strong legacy we created over the past three decades."

Stone Point CEO Chuck Davis said, "Blue Owl's position as a leading capital solutions provider for the alternatives industry makes it well situated to further build on Prima's record of success. We are proud to have been partners with Greg, Nilesh, Julia and the rest of the Prima team for more than 12 years and believe that Blue Owl can help take Prima to the next level. We are enthusiastic about Prima's future as part of Blue Owl and are pleased to take our consideration in Blue Owl equity."

Berkshire Global Advisors L.P. and J.P. Morgan Securities LLC are serving as lead financial advisors to Blue Owl in connection with the transaction. Natixis Corporate & Investment Banking, Wells Fargo, Newmark and Scotiabank are also acting as co-advisors to Blue Owl. Kirkland & Ellis LLP is serving as legal advisor to Blue Owl.

Morgan Stanley & Co. LLC is serving as financial advisor to Prima. Kramer Levin Naftalis & Frankel LLP and Pillsbury Winthrop Shaw Pittman LLP are serving as legal advisors to Prima.

About Blue Owl

Blue Owl (NYSE: OWL) is a leading asset manager that is redefining alternatives.

With over $165 billion in assets under management as of December 31, 2023, we invest across three multi-strategy platforms: Credit, GP Strategic Capital, and Real Estate. Anchored by a strong permanent capital base, we provide businesses with private capital solutions to drive long-term growth and offer institutional and individual investors differentiated alternative investment opportunities that aim to deliver strong performance, risk-adjusted returns, and capital preservation.

Together with over 685 experienced professionals globally, Blue Owl brings the vision and discipline to create the exceptional. To learn more, visit www.blueowl.com.

Forward Looking Statements

Certain statements made in this release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "would," "should," "future," "propose," "target," "goal," "objective," "outlook" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. Any such forward-looking statements are made pursuant to the safe harbor provisions available under applicable securities laws and speak only as of the date made. Blue Owl assumes no obligation to update or revise any such forward-looking statements except as required by law.

These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside Blue Owl's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.

Important factors, among others, that may affect actual results or outcomes include the inability to recognize the anticipated benefits of strategic acquisitions; costs related to acquisitions; the inability to maintain the listing of Blue Owl's shares on the New York Stock Exchange; Blue Owl's ability to manage growth; Blue Owl's ability to execute its business plan and meet its projections; potential litigation involving Blue Owl; changes in applicable laws or regulations; and the possibility that Blue Owl may be adversely affected by other economic, business, geo-political and competitive factors.

Investor Contact

Ann Dai
Head of Investor Relations
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Media Contact

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Principal, Corporate Communications & Government Affairs
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SOURCE Blue Owl Capital