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November 13, 2019  

Sorin Gives Up Blackstone Role, Winds Down

Sorin Capital, a commercial mortgage bond investor that ran $1.6 billion at its peak, is shutting down after a 15-year run.

After liquidating two hedge funds earlier this year, Sorin continued to run a $500 million portfolio for Blackstone. But with Blackstone’s blessing, Sorin transferred management of that vehicle to relative-value credit manager Good Hill Partners at the end of October.

Managing director Joel Jasinski and vice president Matt Rossetto have joined Good Hill from Sorin’s investment team and will continue to run the portfolio for Blackstone.

At least part of Blackstone’s mandate comes from an alternative mutual fund called Blackstone Alternative Multi-Strategy Fund, which already allocated capital to Good Hill.

Sorin was founded in 2004 by chief investment officer Jim Higgins, who previously co-headed Bear Stearns’ commercial mortgage business. Higgins is mulling his next move.

Sorin’s recent performance was unavailable. But sources said the New York firm found it increasingly difficult to identify profitable investment opportunities amid historically tight spreads and low yields for commercial mortgage securities.

Sorin marketed a number of funds over the years and, prior to the 2007 market crash, issued $3.2 billion of collateralized debt obligations backed largely by real estate loans and commercial mortgage securities, according to a database maintained by sister publication Asset-Backed Alert.

By the start of this year, Sorin was running just two hedge funds, in addition to the Blackstone account: Sorin Active Trading Master Fund, which launched in 2017 and had $255 million of gross assets at yearend; and Sorin NL Fund, which launched in 2010 and peaked at $950 million of gross yearend assets in 2015. It was down to $236 million at yearend 2018. The active-trading fund was managed by former One William Street Capital executive Domenico AcriGarofalo.

Sorin’s chief financial officer, Thomas Tam, held a small equity stake in the firm. It’s unclear what he plans to do next. Another partner, portfolio-management head Thomas Digan, left in December 2018. Digan, who owned a significant minority stake in Sorin, is now president of personalized-fitness app developer Ladder.

Good Hill was running $2 billion, on a gross basis, at yearend 2018. The New York firm was founded in 2007 by co-chief investment officers Brant Brooks and Franklin Collins, who also previously held senior structured-product banking roles at Bear.