Real Capital Solutions Launches $350M Distressed Office Acquisition Fund – Commercial Observer
Real Capital Solutions (RCS), a real estate investment firm headquartered in Colorado, has launched a new $350 million fund that will target acquiring distressed Class A and Class B offices across the U.S., Commercial Observer can first report.
The fund, RCS Contrarian Office Fund, plans to lever-up and ultimately acquire up to $850 million of office assets from the $350 million raised. The fund is already capitalized through a $50 million personal commitment by Marcel Arsenault, founder and CEO of Real Capital Solutions, and a second $47.5 million commitment from an unnamed entrepreneur.
The fund will close in the first quarter of 2027.
“While the office market continues to reset, we believe the long-term outlook for premier office assets is extremely strong,” Arsenault said in a statement. “Companies still need high-quality workplaces to attract tenants, foster innovation and drive growth, and those assets will continue to outperform over time.”
This is not the first time RCS has jumped into pools of office distress.
Since 2024, the firm has invested $644 million into acquiring 14 office properties in 10 U.S. markets — buildings that include Walnut Glen Tower and Tower at Park Lane in Dallas; Belleview Tower in Denver; Tysons Pointe in Northern Virginia; 101 Marietta Street in Atlanta; and the Equitable Building in Chicago, a 35-story Class A office tower the firm acquired earlier this year for $132.5 million, or a 77.8 percent discount to replacement cost.
Adam Abeln, chief investment officer and managing director at RCS, credited the firm’s recent investment activity to a “contrarian approach” the firm has always taken, in remarks to CO.
“Generally, we found you get rewarded when you have that contrarian outlook where pricing is disconnected from market fundamentals,” he said. “The whole office market today has been painted with the same brush, and the discounts go across the board, regardless if it’s trophy office or Class A, B or C buildings.”
The new $350 million RCS Contrarian Office Fund has already identified potential acquisition targets in at least 15 different markets, according to Abeln.
“What gives us the competitive advantage is every market is in a different period of the cycle: some markets there’s still downward pressure on pricing and other markets have hit a bottom, and we’re seeing positive fundamentals in others that are in the recovery stage,” he explained.
“While the playbook has been the exact same in these markets, our entry point is always a bit different,” he added.
The new fund builds on RCS’s long-standing track record of investing across real estate sectors and market cycles, particularly in downturns.
Arsenault founded RCS 42 years ago and began investing in distressed commercial real estate during the savings and loan crisis of the late 1980s and early 1990s. Since then, he and his team have followed a similar playbook across asset classes.
“What’s unique about our firm is we’ve always invested on a national level and we’ve switched categories as the sectors dictated it and depending on the opportunity,” said Abeln. “We’re never just an apartment owner or office owner or retail owner. We’ve always gotten into different sectors.”
The playbook, for all intents and purposes, has worked. Since 2008, RCS has generated a 24 percent return across 177 investments, according to the firm. In total, RCS has invested $5 billion in more than 400 CRE acquisitions since its founding in 1984.
Abeln noted that prior to the GFC, the firm sold 80 percent of its portfolio and shorted the residential market, and used $100 million of available capital to deploy into the distress that emerged from that generational wreckage, focusing on the Southeast and California residential markets, and value-add office and industrial. Then the firm bid its time and began to sell its CRE portfolio prior to the 2020 Covid-19 downturn.
“It ended up being a favorable position for us, because after the pandemic hit after 2020, it was good we disposed of those workout deals and went into the bunker and started buying those yield deals,” he said.
Now, the firm aims to run the same strategy across an office sector in the late 2020s.
“[From our perspective] we knew from a value standpoint the office was going to turn around,” he said. “It may not turn around like the prior cycles, but it was worth starting to deploy capital into.”
Brian Pascus can be reached at bpascus@commercialobserver.com.
