Douglas Elliman's $50 Million Boost from Kennedy Lewis Investment Management
July 5, 2024, 3:32 pm
Location: United States, New York
Employees: 5001-10000
Founded date: 1911
Total raised: $50M
In a strategic move to bolster its growth and expansion plans, Douglas Elliman, a leading real estate firm, recently announced a significant $50 million investment from Kennedy Lewis Investment Management. This infusion of capital is set to enhance Douglas Elliman's financial position and drive its strategic initiatives forward.
The investment comprises $50 million in senior secured convertible notes due in 2029, with an interest rate of 7% per annum, payable either in cash or at Douglas Elliman's discretion, in kind at 8% per annum. This financial backing from Kennedy Lewis is a testament to the confidence in Douglas Elliman's agents, business model, and strategic vision.
Kennedy Lewis Investment Management, known for its focus on credit and alternative asset management, has a strong track record in the residential real estate sector. As part of this partnership, Douglas Elliman anticipates tapping into Kennedy Lewis' deep industry expertise, particularly in land and home builder finance investments.
Moreover, the agreement includes provisions for Kennedy Lewis to nominate a director to Douglas Elliman's board, contingent upon holding at least one-third of their initial investment. David K. Chene from Kennedy Lewis and Patrick J. Bartels Jr., an independent director from Redan Advisors, have been appointed to the board, succeeding Ronald J. Kramer and Lynn Mestel.
Howard M. Lorber, Chairman and Chief Executive Officer of Douglas Elliman, expressed enthusiasm about the collaboration, highlighting the potential for long-term shareholder value creation. He also acknowledged the contributions of outgoing board members, Ronald J. Kramer and Lynn Mestel, to the company's success.
In a joint statement, David K. Chene and Darren L. Richman, Co-Founders and Co-Managing Partners of Kennedy Lewis, emphasized their excitement about partnering with Douglas Elliman. They praised the firm's strong brand, reputable agents, and growth prospects in the luxury real estate market. The duo expressed confidence in Douglas Elliman's ability to leverage additional financial and strategic resources to solidify its leading position in the industry.
Additionally, Douglas Elliman shared positive financial updates, with preliminary unaudited gross transaction value for the second quarter expected to range between $10.25 billion to $11.25 billion, a significant increase from the first quarter of 2024. Despite a $7.75 million payment as part of a commission lawsuit settlement agreement, the company reported $92.0 million in cash and cash equivalents on its balance sheet as of the end of June.
Overall, the partnership between Douglas Elliman and Kennedy Lewis Investment Management marks a significant milestone for both firms, positioning them for sustained growth and success in the competitive real estate market.
The investment comprises $50 million in senior secured convertible notes due in 2029, with an interest rate of 7% per annum, payable either in cash or at Douglas Elliman's discretion, in kind at 8% per annum. This financial backing from Kennedy Lewis is a testament to the confidence in Douglas Elliman's agents, business model, and strategic vision.
Kennedy Lewis Investment Management, known for its focus on credit and alternative asset management, has a strong track record in the residential real estate sector. As part of this partnership, Douglas Elliman anticipates tapping into Kennedy Lewis' deep industry expertise, particularly in land and home builder finance investments.
Moreover, the agreement includes provisions for Kennedy Lewis to nominate a director to Douglas Elliman's board, contingent upon holding at least one-third of their initial investment. David K. Chene from Kennedy Lewis and Patrick J. Bartels Jr., an independent director from Redan Advisors, have been appointed to the board, succeeding Ronald J. Kramer and Lynn Mestel.
Howard M. Lorber, Chairman and Chief Executive Officer of Douglas Elliman, expressed enthusiasm about the collaboration, highlighting the potential for long-term shareholder value creation. He also acknowledged the contributions of outgoing board members, Ronald J. Kramer and Lynn Mestel, to the company's success.
In a joint statement, David K. Chene and Darren L. Richman, Co-Founders and Co-Managing Partners of Kennedy Lewis, emphasized their excitement about partnering with Douglas Elliman. They praised the firm's strong brand, reputable agents, and growth prospects in the luxury real estate market. The duo expressed confidence in Douglas Elliman's ability to leverage additional financial and strategic resources to solidify its leading position in the industry.
Additionally, Douglas Elliman shared positive financial updates, with preliminary unaudited gross transaction value for the second quarter expected to range between $10.25 billion to $11.25 billion, a significant increase from the first quarter of 2024. Despite a $7.75 million payment as part of a commission lawsuit settlement agreement, the company reported $92.0 million in cash and cash equivalents on its balance sheet as of the end of June.
Overall, the partnership between Douglas Elliman and Kennedy Lewis Investment Management marks a significant milestone for both firms, positioning them for sustained growth and success in the competitive real estate market.