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Real Estate

Morgan Stanley Investment Management adds Mesa West Capital to real assets business

Morgan Stanley (MS) Investment Management is acquiring real estate credit manager Mesa West Capital, confirmed Lauren Bellmare.

Morgan Stanley is acquiring 100% of Mesa West, said sources familiar with the transaction. Terms of the deal are not being disclosed. Ms. Bellmare declined to provide information beyond a news release. Mesa West has $5 billion in assets under management.

The acquisition will allow Morgan Stanley Investment Management to offer real estate credit as part of its real asset offerings. Currently, Morgan Stanley Investment Management's real asset business primarily offers equity strategies.

Mesa West will remain in Los Angeles, retain its firm name and operate as a separate business unit within MSIM's real assets group. MSIM's real assets group currently manages $47 billion in assets and is overseen by John Klopp, global head of real assets.

Jeff Friedman and Mark Zytko, Mesa West co-founders and principals, will continue to manage Mesa West on a day-to-day basis.

"We are excited to have the Mesa West team join MSIM, and we are confident that the combination will be seamless given their shared focus on clients, strong investment performance and collaborative culture," said Dan Simkowitz, head of Morgan Stanley Investment Management, in the news release.

In a joint written statement in the release, Messrs. Friedman and Zytko said: "We have known John Klopp for nearly 20 years, have worked closely with the MSIM real assets team and are excited to be joining forces with them."

The transaction is subject to customary closing conditions, including obtaining applicable regulatory approvals and requisite investor consents, and is expected to close in the fourth quarter.

Bruce Beck, Mesa West spokesman, declined to comment.