Hedge fund Mount Kellett is gearing up for a major push into the hotels market with the appointment of former Blackstone MD Martin Kandrac.
The distressed buyout firm has appointed Kandrac to its London office, where he will be working with managing directors Peter Calabro and James MacNamara.
Kandrac started at the firm this month after leaving Blackstone in September.
Mount Kellett was part of a consortium that completed the £160m rescue of the Jury’s Inn hotel chain, allowing lenders IBRC, Ulster Bank and AIB to restructure their debt in March last year. It backed the deal, led by Royal Bank of Scotland, with Derek Quinlan’s Avestus Capital Partners alongside Westmont hotels tycoon Majid Mangalji and Oman’s sovereign wealth fund.
The low-profile firm, set up by three former Goldman Sachs special situations executives was reported to be on the capital-raising trail last year, seeking to raise $4bn for a third global special situations fund.
The market for hotel debt investing has been gathering pace over the past year with a number of rival distressed investment vehicles completing deals.
US hedge fund Cerberus and Deutsche Bank each invested in hotels, buying separate tranches of Lloyds Banking Group’s £180m Project East UK corporate loan portfolio.
The major seller this year is Ireland’s IBRC. Its £4.8bn Project Rock non-performing loan portfolio is close to two-thirds hotels, mixed-use and leisure properties. The second phase of this sales process will begin on 19 January with final bids due on 14 February.
Investors are also turning their attention to the recovering continental markets.
Apollo Global Management, which has raised $3.9bn (£2.4bn) to buy distressed European assets, is competing with Lone Star, Blackstone and Goldman Sachs for hotel investments in Spain.
In his 12-year tenure at Blackstone Kandrac was involved in the group’s major European hotel acquisitions including the €150m Concorde Opéra hotel in Paris from Starwood Capital before he left the firm.
Mount Kellett declined to comment.
bridget.oconnell@estatesgazette.com
