Kildare is looking to raise $2bn (€1.75bn) for a second European fund, according to the Texas Permanent School Fund.
The manager, founded by former Lone Star Funds president and Sunderland football club owner Ellis Short, has a $2.5bn cap for the European Partners II fund, which has so far attracted commitments of around $1.5bn.
The manager has been backed by Texas Permanent, which recently approved a $75m commitment to the fund, the investor’s first allocation to Kildare.
The targeted return for the fund is a 16% net IRR, with distressed debt in the range of $100m-200m a typical focus.
Kildare is planning to expand its market coverage for Partners II beyond the UK.
Partners II will still invest some capital in the UK but also invest in Germany, The Netherlands, Portugal and Italy.
Texas Permanent’s real estate consultant, Courtland Partners, said there were still strong investment opportunities in Europe.
Courtland said 18 of the 19 investors for Kildare’s Partners I vehicle had made a new commitment to Partners II.
One unnamed investor dropped its commitment from $1bn to $500m, giving investors like Texas Permanent a chance to invest.
Texas Permanent has also approved an allocation of $70m to the PAG Enhanced Credit Fund.
The $400m-600m fund invests in Sydney and Melbourne residential assets.
The fund focuses on residential real estate that provides a back-stop for Australian banks investing in senior and mezzanine debt.
The fund will have a short-term life, with a two-and-a-half-year investment period and a three-year term.