Monarch Alternative Capital LP is making deals for office and hospitality assets, betting that changes in where Americans live will accelerate while remote work will ebb, WSJ Pro Bankruptcy reported. Investing in distressed corporate debt in the U.S. and Europe is Monarch’s main business, but real estate for office use has taken up more of the firm’s attention — and capital — in recent months. After raising a $3 billion fund in December to invest in all types of pandemic-fueled distress, Monarch has bought six office buildings this year, compared with none in 2020. The firm has also been backing plays for hospitality, retail and senior-housing assets. “In certain asset types there is still fundamental disruption as a result of the pandemic,” said Monarch portfolio manager Adam Sklar. Last month, the firm closed on the 34-story Citigroup Center in downtown Miami, an office building in Plano, Texas, and 10 hotels bought through the bankruptcy of Eagle Hospitality Real Estate Investment Trust. Earlier this year Monarch acquired, also through bankruptcy, the Crowne Plaza Orlando Universal Boulevard in Orlando, Fla. So far, people haven’t been returning to their offices the way they’ve been resuming their lives at restaurants, hotels and stores. As of early June, an average of 31% of office workers had returned to the workspaces they occupied before the COVID-19 pandemic, according to Kastle Systems, a security company that monitors access-card swipes in more than 2,500 U.S. office buildings.
