EXCLUSIVE: Former UBS Exec Launching Fund

While UBS (UBS Quote) continues to wrestle with massive writedowns and layoffs related to the imploding of subprime loans on its balance sheet, at least one former executive is moving on to brighter pastures.

Brian Harris, a top executive at UBS' now-closed hedge fund Dillon Read Capital Management, is launching his own investment fund, TheStreet.com has learned.

Harris, who was responsible for the commercial real estate lending business and not the subprime residential problems at Dillon Read, is raising money for his new fund, called Ladder Capital, a person familiar with the matter tells TheStreet.com.

UBS closed Dillon Read in a high-profile shutdown in May 2007. At the time, Dillon Read had already lost $124 million on its portfolio of subprime residential loans. Dillon Read managed about $1.2 billion of outside investor money and several billion more of UBS funds.

Harris' deals at Dillon Read, however, focused on commercial real estate and not subprime residential loans. While there, he specialized in originating high loan-to-value bridge loans at high lending rates for commercial real estate transactions. These loans were securitized and placed into CMBS and CDO deals.

Ladder Capital will presumably focus on these same types of investments, sources say.

The commercial real estate loan book that Harris originated at Dillon Read has probably run into some issues lately but is generally in far better shape than the subprime residential loans to which Dillon Read had exposure, says one private equity official at a rival firm who has looked at some of Harris' deals.