TH Real Estate has completed the first close of its £500 million ($680 million) Global Real Estate Debt Partners – Fund II, and commenced its investment program with a £44 million ($60 million) loan in the South East of England.
With capital committed from Asian, U.S. and European institutions, investors cited the potential for stable, income-focused returns with a low correlation to the wider property and investment markets as supportive factors.
Loan origination is focused on high-quality real estate, well-positioned across South East and regional markets of the United Kingdom. The fund will utilize a senior syndication strategy of selected whole loans in order to enhance returns and optimize its investment portfolio.
The successful first close of the Global Real Estate Debt Partners – Fund II follows the origination of £1 billion ($1.4 billion) in new loans in 2017 and the completion of £750 million ($1.02 billion) in new loans so far this year. The firm’s global debt platform has grown significantly in recent years, and continues to invest at pace, attracting capital for a range of pooled funds and separate mandates from a global client list. The platform recently announced plans to expand into Asia Pacific with the appointment of Martin Priestly as head of debt for the Asia Pacific region.
“The success of this first close demonstrates the appeal of investing in debt and in particular, our strategy, which aims to offer a measure of downside and performance protection, diversification, and the opportunity for stable, income-focused returns,” said Christian Janssen, head of commercial real estate debt, Europe, at TH Real Estate.
TH Real Estate’s global debt platform, which has been investing since 1934, manages assets of more than $29 billion across the United States and United Kingdom, representing 25 percent of the overall business. It invests across the capital structure, seeking income-focused, stable and attractive, risk-adjusted total returns for investors through a diversified portfolio of commercial real estate debt investments.
In order to provide investors with a tailored solution, TH Real Estate has developed its resilient, enhanced debt series. The debt series is designed to provide investors with access to potentially secure, income-focused returns. The strategy may suit cautious investors seeking attractive levels of income with a measure of downside protection against short-term capital cycles.