Redwood Hedge Fund Gains 14% in 2021 on Malls, AMC’s Landlord

Redwood Capital Management posted a 14% net return in its $4.2 billion flagship hedge fund last year, according to people with knowledge of the matter.

The New York-based credit and special situations investor benefited from wagers on troubled shopping malls and lenders mired in regulatory issues, while holdings in embattled Chinese developers hurt its performance, said the people, who asked not to be identified because the results are private.

A representative for Redwood declined to comment.

Amid exuberant markets and easy monetary policy, last year was hardly a welcoming environment for distressed investing. Still, Redwood profited from bets in companies ...