KKR real estate lender’s woes attract investor Mavik

Published Wed, Aug 19, 2026 · 04:08 PM

[NEW YORK] An investment firm that specialises in commercial real estate distress is betting that a lender, managed by KKR & Co, is likely to sell its loan portfolio at or around book value. 

Mavik disclosed that it has a 5.4 per cent stake in KKR Real Estate Finance Trust (KREF), which invests in commercial mortgages.

The trust said in July that it was exploring strategic options, including a merger or a sale of the company, even as it seeks to resolve troubled legacy loans and reposition its portfolio.

KREF has been trading at a steep discount to book value since 2022, when a rapid increase in interest rates hammered commercial real estate.

Mavik believes the strategic review is likely to lead to a sale or liquidation at or near the value of its underlying loans, CEO Vik Uppal told investors in a letter on Tuesday (Aug 18). 

Representatives for Mavik and KKR declined to comment on the investment.

In the letter, Uppal pointed to a transaction this year, in which a commercial mortgage real estate investment trust, managed by Apollo Global Management, agreed to sell its loans to Athene, an insurer also owned by Apollo, for just under book value.

If KREF does something similar and sells its loan portfolio for 95 cents on the dollar, Mavik expects to earn an internal rate of return of more than 30 per cent on its investment, the letter said. 

Mavik invests in commercial real estate across the capital stack, including first mortgages, mezzanine loans and preferred equity. In July, it was reported that the firm was looking to raise US$1 billion to invest in distressed commercial real estate assets. BLOOMBERG