Smith, Graham & Co Investment Advisors, a USD6 billion institutional solutions based asset manager, has acquired the Five Mile Capital Partners’ residential mortgage team, an alternative investment manager, led by Brian Tortorella, managing director.
The acquisition will further strengthen SGIA’s focus on expanding its fixed income investment capabilities to address current and future client needs.
“The appeal of this offering, rebranded as ‘Mortgage and Real Estate Debt Alternatives’, is rooted back to our inception in 1990 when we found that mortgages provided above market yields with little additional risk over corporate debt,” says Gerald Smith (pictured), chairman and CEO. “The acquisition complements our portfolio of repeatable investment solutions and has low correlation to our existing fixed income products. These strategies will allow us to offer high yielding, low beta investment opportunities to current and prospective clients.”
The team has a nearly decade long track record managing performing and re-performing mortgage loans, as well as short–term bridge loans. During this period they have invested over USD850 million in these types of mortgage loans. Tortorella and his colleagues bring over 40-years combined industry experience at firms such as Goldman Sachs, UBS, Greenwich Capital and RBS.
Tortorella says: “I am excited to be a part of SGIA’s impressive team, which is known for its operational expertise, proprietary risk management and institutional distribution. I look forward to providing a new asset class that will serve institutional investors and propel the firm’s growth.”
Consistent with previous acquisitions, SGIA’s focus continues to be on its investment process and ability to deliver greater diversification and yield enhancement. In 2009, SGIA acquired the fixed income and small and mid-cap value equity assets from Ark Asset Management. SGIA now provides a full complement of customised fixed income solutions across the yield curve including alternatives, that help clients navigate challenging market environments.
“In light of the tremendous growth opportunities in the alternative space available today, we are proud to add a fixed income alternative that focuses on assets that require operational expertise, have limited competition and accretive optionality,” says Donna Sims Wilson, president. “We believe this will allow the firm to continue to create a comprehensive product portfolio that better serves our client’s needs.”
