Related Cos. and Highbridge Principal Strategies (HPS) formed a joint venture to manage a new real estate credit investment platform. The partners plan to invest $800 million in real estate debt, specifically gap financing for real estate projects in transition across the U.S. such as redevelopments, conversions and new construction.

The venture will focus on gateway cities, including New York, Boston, Chicago, Washington, D.C., Los Angeles, San Francisco and Miami, and select secondary markets that demonstrate strong supply/demand imbalances. It will evaluate opportunities involving first lien mortgages, mezzanine loans and preferred equity positions in land deals and non-stabilized assets.

Brian Sedrish, who previously served as head of acquisitions for the commercial real estate division of Deutsche Bank, will join the venture as managing director and will serve as a portfolio manager for the platform.

“We are pleased to partner with Related, one of the most successful developers, owners and operators of real estate assets in the U.S., and to welcome Brian to the team,” said Alex Popov, managing director with HPS, in a statement. “This joint venture will combine our due diligence and established credit structuring capabilities with Related’s 40-year track record in sourcing, developing and managing real estate assets, to take advantage of attractive investment opportunities created by significant financing gaps in the residential and commercial real estate market.”

Justin Metz, Managing Principal of Related Fund Management, the fund management platform of Related, added: “Together with HPS, we have identified an opportunity to capitalize on the demand for financing solutions and recapitalizations in the current market, and to make debt investments secured by non-income producing assets, which are not eligible for securitization.”