Texas-based investment firm Satori Capital has completed a USD30 million investment in Cicero Capital Partners.
The investment is part of the Satori XL Partnership Program, which forms strategic acceleration partnerships with talented emerging investment managers that typically have at least a three-year track record and less than USD100 million of AUM.
Based in Columbia, Maryland, Cicero actively manages a portfolio of commercial mortgage-backed securities (CMBS) and other commercial real estate structured opportunities. The firm’s AUM as of 1 July, 2019, is approximately USD77 million.
Cicero’s portfolio managers have developed a comprehensive due diligence process over a combined 38 years of investing through various CMBS cycles across the spectrum of commercial real estate securities. Cicero believes the inefficiency of the CMBS universe creates an opportunity for experienced managers to capture structural alpha in a risk-controlled fashion, and the investment team leverages its extensive experience with analysing property-level asset valuation and credit quality to access these pockets of inefficiency. Primary drivers of the strategy’s expected returns include higher-yielding event-driven bonds that require deep analysis to reduce risk and a mixture of investment-grade and non-investment-grade CMBS securities.
“Through our Satori XL Program, we look for managers who have mastered their investment process and have the long-term track records to prove it. With Cicero, we believe we have found just that,” says James Haddaway, chief investment officer for Satori’s alternative investments platform. “Bob Neighoff and Evan Kurtz have dedicated their entire investment careers to CMBS investing. Their unique investment process has been honed through not only multiple real estate cycles, but also through the experience they have gained in various complimentary roles over the past 20 years.”
Portfolio Manager and Partner Bob Neighoff joined Cicero in early 2011 to implement a CMBS trading strategy that soon became the best-performing component of the firm. He then purchased the management company and established a dedicated CMBS fund. Prior to Cicero, Neighoff was responsible for non-agency CMBS and agency mortgage trading as a senior portfolio manager at VERO Capital Management and served as a principal in the real estate finance group at American Capital, Ltd., and he began his career as a CMBS trader for the Royal Bank of Scotland. Portfolio Manager and Partner Evan Kurtz joined Cicero in 2015. Previously, he spent nine years at American Capital, Ltd., where he directed secondary CMBS investments, managed a portfolio of CMBS control deals, and directed the special servicing strategy for more than 500 defaulted commercial real estate assets.
“Satori’s principals have firsthand experience launching, managing, and growing investment funds,” says Neighoff. “They can offer us practical guidance on operational issues, capital raising, fund structuring, and more, and we’re thrilled to have a partner that will work with us as we grow.”
