First Capital Makes a United Play

By Gail Kalinoski, Contributing Editor

First Capital Real Estate Investments, L.L.C., a Sacramento, Calif.-based real estate and investment firm, has expanded to the East Coast with the $175 million acquisition of United Realty Advisors, L.P., a New York company that is the external advisor to United Realty Trust Inc.

Suneet Singal, First Capital

Before the acquisition of United Realty, First Capital and its affiliates transferred 28 assets to the REIT valued at more than $175 million, including 18 hotels, five retail and self-storage properties, various residential and commercial land for development, and contract rights to buy 13 additional hotels and more than 1,000 multifamily units. Both transactions closed Sept. 15 and were made public this week with an 8K filing to the U.S. Securities and Exchange Commission.

“We are tremendously excited about the acquisition of United Realty,” Suneet Singal, CEO & chairman of First Capital, said in a prepared statement. “We believe this transaction allows First Capital to expand our platform capabilities through the acquisition of a firm which shares our value-add and opportunistic investment philosophy.”

Singal becomes CEO and chairman of the board of United Realty Advisors and United Realty Trust.

Javier Vande Steeg and J. Tim Pruban were named independent directors and Anthony Arostegui of Downey Brand L.L.P. was named general counsel.

United Realty Advisors, a privately held real estate and advisory firm, and United Realty Trust, a public non-traded REIT, were run by Jacob Frydman, the former CEO & chairman of the board. Frydman resigned those roles at closing of the deal with First Capital. He was appointed Chief Investment Officer of United Realty Trust and entered into a consulting agreement with First Capital and United Realty Advisors, according to the 8K form filed with the SEC.

With offices located in Lower Manhattan, United Realty Trust focuses on retail, office, hospitality and multifamily properties. Assets include Tilden Hall, a nine-story, 117-unit apartment building in Brooklyn that was purchased for $22.3 million in March 2013. The REIT also owns a two-story., 44, 323-square-foot medical office building in Myrtle Beach, S.C., that is triple-net-leased and fully occupied; and 7 Carnegie Plaza, a medical corporate headquarters in Cherry Hill, N.J., that has about 90,000 square feet of space and is fully leased.

First Capital was founded in 2003 and began in the mortgage and real estate business working with commercial and residential assets. It has developed into a vertically integrated company that offers finance structuring, real estate acquisition, land development, construction of residential and commercial properties, retail operations and asset reposition. In 2006, Singal acquired and merged with Amerifund Financial, a real estate lending platform, and grew the combined company to over $1 billion a year in originations as a direct lender in 40 states.

Singal told the Sacramento Business Journal that First Capital is in negotiations to acquire a master plan community in Sacramento that would become part of United Realty Trust. He also told the business publication that First Capital is considering creating new REITs for certain property sectors or regions.