By Les Shaver
When Gregory Freedman, co-founder of real estate investment firm BH3, put together its distressed debt fund in late 2018, the world looked a lot different. The firm was expecting the usual end of cycle buying opportunities in its backyard of New York City.
The management team at BH3 thought the next downturn could resemble the 2008 recession. Though it would be less severe, it could provide similar opportunities to allocate capital.
“In 2018, people might be thinking it may be a repeat of 2008 when the borrowers just stopped paying,” Freedman says.
Though it was never expecting a pandemic-fueled recession, BH3 set up a dedicated distressed vehicle at the end of 2018. “We felt that asset prices were frothy and we were approaching the end of a bull market,” Freedman says. “We were wrong because 2019 was an amazing year and the bull market run continued.” Read more.