Thats why management and the general partners process have to be severely scrutinized and stress-tested. LT: Right now, we are one of the biggest lenders in cannabis. But the community was up in arms long before Gamma took over the property. Beninati had a different perspective, describing Gammas role as active in court documents, saying that the lender demanded that the developers make dozens of changes to the project design, implementation and construction. This is clearly an extremely speculative play. Background Report for Jonathan Kalikow. Traditional financing is notoriously difficult to get for cannabis companies, experts say. The second way we are different is we, as the first NASDAQ-listed lender and the leading lender in the cannabis industry, have a considerable hold size where we will hold the majority of the loan versus syndicating them. We have asked all our borrowers to provide us with two to three charities they are passionate about, and we are currently evaluating our first few charities and going through the vetting process. So we tend to work with three different buckets of operators. We include exclusive video so our members can get all of the latest and greatest insight and maximize portfolio performance. Join iREIT on Alpha today and get a "front row seat" to our "March Madness" REIT Bracketology series where we break down each property sector to arrive at the "Sweet 16 REITs" to own. The estimated net worth of Jonathan Gilbert Kalikow is at least $1.52 million as of June 16th, 2022. Coupled with its other financial resources, it's sufficient to achieve a diversified portfolio capable of demonstrating AFCs abilities. The fact of the matter is, lawsuits cost a lot of money. Jonathan Neale strangled his wife after he passed out drunk on the floor. This does offer investors an average amount of protection, though its still far from perfect. That's considerably lower than the likes of Blackstone Mortgage Trust and Starwood Property Trust's (STWD) ~8% yields the two commercial mREIT heavyweights. There, he invested across industries and asset classes on behalf of institutions, family offices, and wealthy individuals as a proprietary trader at Morgan Stanley and then as a hedge fund portfolio manager and trader at various funds and firms. We want to be there for the company's second and third financing. As in, now youve fucked with the wrong person.. When you're lending to a Verano or an Acreage, you're not just lending to one state; you're lending to multiple states. This broader mandate means we must have greater confidence in its underwriting standards and practices and in its management. There are corporate governance concerns, but the portfolio is highly profitable and suited to grow very quickly. AFC Gamma, Inc. originates, structures, underwrites, and invests in senior secured loans, and other types of loans and debt securities for established companies operating in the cannabis industry in states that have legalized medicinal and/or adult use cannabis. Secondly, the suit claims that the Pilevskys altered the treatment of 3 Sutton Place, as a Single Asset Real Estate in the bankruptcy filing by transferring three small cooperative apartments at 504 Merrick Avenue in Lynbrook, N.Y., over to Beninati. And while not uncommon, this isnt the best practice, since it inherently gives the CEO greater control. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. Kalikow said he has been told that the ERFA, which has grown to include 45 buildings and roughly 2,600 individuals living within and outside the propsed rezoning area, spent $1.3 million to $1.4 million trying to fight 3 Sutton Places height, speculating the bulk came from residents of The Sovereign. 5. Jonathan Kalikow was born and raised in New York. These companies can't even get bank accounts. I was on the stand for seven hours, Kalikow said. Of course, as in any market, some operators will be successful, but we do not have plans to enter the California market. He also holds a JD from Fordham University School of Law and is a member of the New York State Bar Association. The only count left was criminal usury, for which the court ruled that the building loan had a rate higher than the New York statute. We don't just want to be there for the company's first financing. But before getting there, its worth examining the origins. But common sense and statistical analysis does indicate greater risk of lower quality Board of Directors construction and efficacy. A New Cannabis Dating Service Might Solve Your Financial Needs, Golf Odds, Picks And Props: 2023 Arnold Palmer Invitational Betting Preview, Most GOP Voters Support Weed Legalization, Says New Poll, Advanced Flower Capital Gamma (AFC Gamma). Why did your team decide to go public in March 2021, and have you noticed a shift in how cannabis stocks are viewed among institutional investors in the past year? RT: AFC Gamma is a commercial mortgage REIT. Kallos, Krueger, Garodnick and a representative of Brewer met with Kalikow on May 11 to discuss controversies surrounding the site, including the communitys firm opposition and how steep a climb Gamma would have to complete the project. Live market coverage co-anchored from Hong Kong and New York. Photo by pcess609/iStock via Getty Images. I was also in charge of investor relations at Fifth Street and was doing healthcare consulting while we both recognized the lending opportunities in cannabis. Williams Equity Research's founder has been analyzing institutional investment and operational due diligence for the last decade. I guess its hurt a little bit in terms of [business driven by] word of mouth, but because we have a 50-year history of doing this, were [easily vetted]. Employment Details. Thomas is also the author of The Intelligent REIT Investor Guide (Wiley) and is writing a new book, REITs For Dummies.. Aside from Arizona, New Mexico, and Nevada, most of our deals are made in Mississippi. Three of the companies are still active while the remaining one is now listed as inactive. It comprised a $145.9 million single loan to refinance the previous loan and a $1.4 million building loan to fund the demolition of the existing properties at the site. Fortunately, WER's expertise is in the private institutional space. Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. The loan maturity date of Jan. 19, 2016, arrived and Bauhouse Group hadnt repaid any amounts under the loan agreements, according to court filings. There were so many little fights during this war. With license value being a component of our underwriting, we tend to focus on limited license states such as New Jersey, Florida, Pennsylvania, Ohio, to name a few. Invision. [In 2015], Beninati goes and describes the enormity of the project, which pisses off all the neighbors, who then raise money for their councilman [Ben Kallos], who then starts a rezoning proposal, Kalikow said. My family is in real estate, and everyone in the real estate business likes to have the press. The third tier is smaller operators. As an institutional lender, we provide financial solutions to the cannabis industry. Leonard M. Tannenbaum is the CEO and founder, with the investment committee being composed of Jonathan Kalikow and Robyn Tannenbaum Leonards wife as of 2019 when they made their IPO filing. So how is AFC Gamma helping cannabis companies gain access to capital and what do you offer them? The first type is known as a sale-leaseback, which was around before loans were available. Image Source; Jonathan Roumie's Instagram. Mr. Kalikow is a graduate of the Wharton School of Business with degrees in Real Estate and Finance. We needed someone with significant real estate expertise and brought on Jonathan Kalikow as our third partner. China Equity Emerging Markets Gold and Silver International Dividend US Dividend US Energy US High Dividend US Large Cap Growth US Large Cap Value US Mid Cap Growth US Mid Cap Value US REIT US Small Cap Growth US Small Cap Value US Sustainable (ESG) But imagine the combination of near total lack of competition and immense opportunity set. (Podcast). Banco Inbursa was one of the first lenders out of the gate, entering into negotiations for the projects financing and executing a term sheet for a $70 million loan. They changed the bankruptcy law for real estate in 2005 to say that if youre a single real estate asset its a faster trackso, you as the developer cant tactically declare bankruptcy and indefinitely hold up your lender, Kalikow explained. After the sale, I took some time off and started a family office, and saw an arbitrage opportunity in the cannabis industry while researching investments. If we move to a fast-growing, small mREIT like Arbor Realty (ABR), the situation isn't much different. When Beninati defaulted on the $147 million loan from Gamma, the lender foreclosed on the property and later acquired it in a foreclosure auction for $86 million ($98 million including air rights), outbidding Brooklyn investor Isaac Hager. There are so many great opportunities to put capital to work with good borrowers. (The city must log and address each complaint as it relates to construction safety. Somebody wants to put up 1,000 feet here, Kallos told CO. And Im like, You mean at 432 Park? They said, No, [East] 58th Street and Sutton [Place]. I said, Theres no way. 8. Learn More about Jonathan Gilbert Kalikow's net worth. Jonathan Kalikow 's Gamma Real Estate allegedly used an $83 million real estate loan and fraud to seize a massive real estate project near Dallas worth more than $500 million, according to a lawsuit filed by the ousted developer.. Stanley Thomas, who led the Wade Park Land Holdings mixed-use development, says Kalikow manipulated him for about two years before laying claim to the complex . In AFC's case, there is an incentive compensation clawback provision in the management agreement. Len, who serves as CEO of the AFC Gamma.and previously founded Fifth Street Asset Management, which he eventually sold to Oaktree, also founded LMT Investments, a single family office that is focused on allocating capital across various strategies, including credit via Tannenbaum Strategic Credit Fund, which is a $100M+ fund, equities and real estate. Insiders at AFC Gamma own 28.0% of the company. Suppose the Senate passes the SAFE Banking Act this go-around, which I believe they will, lenders, including AFC Gamma, will be able to borrow cheaper, which will, in turn, allow lenders to lend cheaper. "I love Jesus and it is the honor of my life to get to portray him," he said. I offered them options such as using their air rights in other parts of the city, Kallos added. RT: Many success stories have resulted from our funding and operators that we provided capital to build and expand their businesses. It yields 8.3% despite more than doubling in price in the past 12 months from $6.67 to $16.16. Robert Levy, another independent director, has substantial experience in retail and multifamily commercial real estate. So it's critical to use limit orders when transacting such a low liquidity stock. You may opt-out by. Again, serving on two related boards concurrently doesnt violate the requirements of an independent director. In many ways, its approach is in between that of a Business Development Company and mREIT. Jonathan Kalikow Partner, Head of Real-Estate BIO Brett Kaufman Chief Financial Officer and Treasurer BIO Gabe Katz Chief Legal Officer BIO James Velgot Chief Marketing Officer BIO Christopher Gioia Managing Director, Head of Origination BIO Brandon Hetzel Executive VP BIO Edwin Gomez Director BIO Carly Hooker Director BIO Professionals Kalikow, the 47-year-old married father of four girls ages 8, 10, 12 and 17, is the president of Gamma Real Estate and a man of real estate pedigree par excellence. Kallos said that during the meeting, he flagged the height of the building and warned Kalikow that it might be in Gammas best interest to scale down the project to fit the neighborhoods context or use its air rights elsewhere. Jackie Bryant: Len, Robyn, whats your background, and what were you doing before jumping into the world of cannabis? Prior to co-founding Gamma Real Estate, Jonathan Kalikow spent 18 years on Wall Street investing across industries and asset classes as a proprietary trader at Morgan Stanley and then as a hedge fund trader and portfolio manager. Are there any notable success stories that resulted from your funding? Portfolio Builder / Fund Intersect. Beninati also alleged that Gamma was not a lender but a partner and acted as equity, Kalikow said. Im sure itll be successful because there are a lot of powerful people involved who are smarter than me, but I dont see us building new tunnels or bridges or subway lines any time soon., I tend to be a very under-the-radar person, Kalikow explained. If you have an ad-blocker enabled you may be blocked from proceeding. While we strongly prefer internal management, having the opposite doesnt mean we automatically ignore a company. Additionally, AFC Gamma has a credit line of up to $40 million, providing the REIT with approximately $120 million of capacity to lend to cannabis operators. Given its especially profitable, high-interest rate loans even somewhat expensive leverage will create a spread of at least 500 basis points and potentially 800-900. All rights reserved. On Feb. 23 the motion was denied on the merits that the borrowers would not be irreparably harmed by the sale and that the equities favored allowing Gamma to enforce its contractual rights. One of our lawyers called up his lawyer and said, Did you guys make an error? They said, No. Youre not winning this one.. As of the date of the S-11 filing associated with the IPO, AFCG had a sizeable $5.5 billion loan pipeline. ERFA President Alan Kersh responded to Kalikows assertion by saying, Together, [ERFA] building owners and city residents have reached into their pockets and donated funds to support our rezoning efforts. It could also be positive for lenders assuming they have the infrastructure and capabilities to scale and decrease the cost of capital once the money starts flowing and more deals are being made. Under the terms of the second loan, Beninati had to either find a partner or find a buyer for the development, according to Kalikow. Jonathan Roumie is an American actor best known for his role as Jesus in The Chosen, [1] [2] a crowd-funded television series about the life and ministry of Jesus of Nazareth. LEWIS J. LIMAN, United States District Judge: OPINION AND ORDER LEWIS J. LIMAN, United States District Judge: This case arises from the financing and development of two parcels of land outside Dallas, Texas, known as Wade Park. Disclosure: I am/we are long BXMT, ABR, BRMK, LADR. The rest are likely or highly likely to be disproportionately influenced by the CEO due to past or ongoing outside business relationships. Still, Gamma Real Estate nevertheless found itself embroiled in a real estate battle and forced into the spotlight after it financed Joseph Beninatis Bauhouse Groups 87-story residential development at 3 Sutton Place between East 57th and East 58th Streets. LT: We have not currently made any loans to operators in California, Washington, Oregon or Oklahoma. So he understands the layers of complexity involved. So we look at diversity on a step-by-step basis rather than a borrower-by-borrower basis. Jonathan specializes in catalyst-driven markets with high barriers to . [Beninati] would have made $50 million after paying us off, had he done the sale, Kalikow said. We decided to share a few more details on this analysis than we usually since its a great case study for subscribers to learn from. Now imagine how much investors can make from that kind of company. The higher end of that range equates to an 8.3% yield. And of the four directors classified as independent, one worked under said CEO as recently as 2017. But weve been very under the radar when it comes to lending. Serial cheat Jonathan Neale, 40, fell asleep by his front door a I surmise that [Pilevsky] was introduced to Joe, who told him, Woe is me, I dont want to lose my baby, Kalikow said. Company/Fund Name: Gamma Real Estate Capital Management, Inc. New York City Council District 5 representative Ben Kallos first discovered news of Bauhouses planned development from a local resident while attending an Easter egg hunt in April 2015. RT: I believe our challenge hurdle is always being stewards of capital. While not necessarily unusual, this potentially augments Leonard's already powerful decision-making ability even further. The company was incorporated in Florida two months ago. RT: Our strategy for building a diverse portfolio is to lend to multiple operators of all sizes, the large MSOs, the mid-tier MSOs, and single state operators. Like Beninati and Bauhouse, the Pilevskys did not respond to COs requests for comment. In cannabis, it's sometimes difficult to predict the timing of closings, but were excited about our pipeline. The commercial mortgage REIT also has a credit line of up to $40 million, freeing up a total of $120 million in capital. India FM Jaishankar says Soros dangerous, debate needed on democracy, Buffett's Berkshire profit falls on investments, currencies, Bill Gates buys Heineken stake, despite saying he's 'not a big beer drinker', Elon Musk recruits team to develop OpenAI rival - The Information, Musk donated around $1.95 billion in Tesla shares last year, Hedge fund manager Chris Hohn demands Airbus drop Atos deal - letter, Elon Musk's challenge: Stay ahead of the competition, ISS urges Apple shareholders to vote for CEO Tim Cook, other execs' pay packages, Elon Musk accuses media of racism after newspapers drop 'Dilbert' cartoon, French media billionaire Niel fails with bid for TNT television frequence - Arcom. Please don't hesitate to contact us and let us know how we can assist. We offer a flexible solution to meet the needs of our borrowers. Jonathan Kalikow is currently associated with one company, according to public records. Looking to the future, though, if the SAFE Banking Act passes, we could see an influx of institutional capital that would increase competition amongst cannabis-specific and mainstream lenders. If you can't find at least a few really good and bad aspects of a new company especially in a new and controversial industry, you probably aren't looking hard enough. JB: Cannabis companies of all sizes have been traditionally starved of access to capital most mom-and-pop and larger established businesses like MSOs cannot walk into a bank or financial institution and receive a loan. It's not zero, but still. So why they would want to get into a fight with us literally makes no sense. Read the latest edition of the Commercial Observer online! The complaint alleges that the three of them, as strangers to the project, caused Beninati to breach contractual obligations following his maturity defaults and helped him file for bankruptcy in a scheme to benefit themselves and obtain an ownership interest in [3 Sutton Place]., Were suing Pilevsky for over $100 million, Kalikow said. While the then-single Robyn joined the firm in March 2014 while Leonard was still married to his second wife, Stacey Thorne. The company has so far provided $50 million in financing to five marijuana businesses, including dispensaries, cultivators, processors, and combined operations. SUITE 1770, WEST PALM BEACH FL, 33401. So the portfolio isn't as robust in a rising interest-rate environment. Thats when it announced: AFC Gamma completed a first close of its $200 million investment vehicle, having raised approximately $80 million of equity from over 20 large family offices. We tend to focus on deals in limited license states and also deals that have real estate as collateral. This building [101 Park Avenue] is next to Grand Central [Terminal], whereas it could take you another 40 minutes to get over there. This creates a very quick and reliable way to boost its cash flow from about $1.25 per share to $1.50-$1.75 in short order. Gamma Real Estate Capital Management, Inc. Learn More about Jonathan Gilbert Kalikow's net worth. The proposalbrought forth in January 2016would ban commercial development between East 52nd and 59th Streets east of First Avenue and cap the height of new structures at 260 feet. He agreesbut then goes radio silent.. There is still a limited subset of institutional investors who are comfortable with cannabis, despite us being listed on NASDAQ. Why? But, according to the post-trial memo, Inbursa backed out a week later because, the bank claimed, the value of the collateral would not be sufficient to satisfy its 45 percent LTV requirement. AFC is externally managed, which isn't unusual for an mREIT. On Feb. 17, 2016, Bauhouse filed a suit seeking a preliminary injunction to stop the foreclosure sale. Kalikow has reason to be angry. Grace Prize for Most Inspiring Performance for TV, Movieguide. Learn More on Jonathan Gilbert Kalikow's trading history. Gamma filed a complaint against Pilevsky, plus his sons Michael and Seth Pilevsky, for tortious interference, in a filing dated Sept. 16, 2016. The corporate mailing address for Mr. Kalikow and other AFC Gamma executives is 525 OKEECHOBEE BLVD. Leonard founded the firm and remains as chairman and CEO. The board of directors, meanwhile is led by Leonard M. Tannenbaum. Mr. Harrison is currently Senior Operating Partner at Merida Capital Partners, "a private equity firm specializing in the cannabis ecosystem.". Jonathan Kalikow. Long-term, we would like to benefit the states that our borrowers operate in. By January 2016, the ERFAbacked by Kallos and Manhattan Borough President Gale Brewer as well as State Senator Liz Krueger and Councilman Dan Garodnickhad formed and filed its first rezoning application with the Department of City Planning, looking to cap the height of the building and also secure a section of the residential development for affordable housing units. We believe its well-positioned to profitably capitalize on the almost completely untapped market of financing cannabis projects. All rights reserved 2023 The Real Deal is a registered Trademark of Korangy Publishing Inc. Greystone sells Lantana apartments to real estate mogul for $10M, Hialeah Gardens industrial site trades at $1M/acre, as market softens, Pasadena moves to eliminate planned development zoning, CF Industries relocates suburban HQ to Northbrook with slight downsize, LaSalle sells OC office building at 55% loss. Mr. Kalikow is a graduate of the Wharton School of Business with degrees in Real Estate and Finance. JB: Although AFC Gamma is open to lending to all aspects of cannabis production, Im sure not all operators qualify for financing. Photo: Sasha Maslov/for Commercial Observer, I believe in completely disproportionate retaliation, Jonathan Kalikow told Commercial Observer, like, Kalikow, the 47-year-old married father of four girls ages 8, 10, 12 and 17, is the president of, Still, Gamma Real Estate nevertheless found itself embroiled in a real estate battle and forced into the spotlight after it financed, The Kalikows arent exactly wet behind the ears when it comes to real estate lending. Mr. Kalikow owns 97,500 shares of AFC Gamma stock worth more than $1,520,025 as of March 1st. Are there specific deals the team tends to focus on more? AFC Gamma, which stands for Advanced Flower Capital, announced it raised $80 million of equity from 20 family offices, completing the first round of its $200 million investment vehicle, according to a press release. Markets never sleep, and neither does Bloomberg. But, its 3 Sutton Place that has been the subject of the most industry chatter (and headaches for Kalikow) over the past couple of years, and the embattled property isnt out of the woods yet. But, despite his past, he's not optimistic about. He asked, What sell-out price are you using? and we replied, $4,000 a foot. He said, What if you use $7,000 a foot? We said that if you use $7,000 a foot you probably make half a billion dollars. Most recently, on Thursday, June 16th, Jonathan Gilbert Kalikow bought 57,600 shares of AFC Gamma stock. But this experience could aid her in assisting AFC as partner, head of origination, and investor relations. I am not receiving compensation for it (other than from Seeking Alpha). But based on 2020 data incorporated in SEC filings and assuming a 100% payout ratio. Jonathan Roumie is drinking coffee. But the good news is, if China invades Taiwan, there is a way to protect yourself. Learn More on AFC Gamma's active insiders. 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