New York City-based Compound Asset Management announced this week its principals are raising money for a new fund aimed at buying shares in real estate companies hit hard by the stock market rout that they expect will recover.
The fund, called the Compound Recovery Opportunity Fund, will focus on real estate businesses in the hospitality and leisure sectors. It is being managed by Compund principals Janine Yorio, Manish Shah and Jesse Stein. Compound, founded in late 2017, pools money from retail investors to buy residential properties in fast-growing cities. Yorio said the idea for the fund came to them in the office as they were watching the stock market plummet and realized they needed to change their investment strategy.
“The chatter in the office became so skewed toward ‘Oh my god, this stock is taking a nosedive, oh my god the markets are a bloodbath,’ and it was really just impossible to ignore,” said Yorio, adding that it reminded her of other market downturns of the last three decades, including the dot-com bust, the 9/11 attacks and the 2008 financial crisis.
“There are unique windows of opportunity to actually start investing because the market behaves irrationally and these corrections are usually finite,” she said. “I felt there was an opportunity to start looking at investments, and to start aggregating dry powder so we would be able to invest in the inevitable recovery that’s likely to ensue.”
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