Walton Street Capital has exceeded the initial $1.25bn (€1.14bn) fundraising target it set for its latest real estate debt fund to raise $1.52bn.
The manager said the amount raised for the Walton Street Real Estate Debt Fund II fund at final close included both commitments directly into the fund and its related parallel fund.
The Montana Board of Investments, which said in a meeting document that it has approved a $30m commitment each to DRA Growth & Income Fund X and Oak Street Real Estate Fund V and $10m into Fidelity Real Estate High Income Fund, also said it issue a $100m commitment to the Walton debt fund.
The fundraise for Walton Street’s latest debt fund exceeds the size of its first debt fund, which raised $654m in 2016.
Debt Fund II targets apartments and offices in US markets and has so far invested in a variety of markets including San Francisco, Washington DC/Northern Virginia, Dallas, Los Angeles and Salt Lake City.
Richard Ratke, a managing director and head of the debt platform for Walton Street Capital, said: “At this point in the cycle, Walton Street shares the view with its investment partners that value-added/core-plus debt offers superior cash yields, risk-adjusted returns and downside protection compared to traditional core equity strategies.
“Further, private real estate credit has grown to serve a permanent need within the real estate capital structure and should provide substantial investment opportunities.”
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