Tristan raises €1.5b for value-add fund in fastest ever capital raise

Tristan Capital Partners has achieved the fastest capital raising in the firm’s history with equity commitments for its Episo 4 value-add/opportunistic fund hitting the fund’s hard cap limit of €1.5 bn at final closing, after just four months of marketing.

With global demand for real estate investment surging, particularly for European assets, Tristan's fund was oversubscribed and the firm found itself unable to accommodate more than €500 mln of unfulfilled demand, leaving EPISO 4 approximately 30% oversubscribed.

'Real estate has become an attractive alternative for fixed income investments both in terms of yield and duration in a low interest rate, low inflation marketplace,' commented Ric Lewis, CEO of Tristan Capital Partners. 'Our recent fund offering also benefited from the strong appetite for European property assets where there is still considerable value to be extracted as the EU’s economic recovery gains momentum. This is the largest single equity raise in the firm’s history and I’m proud that the vast majority of the capital committed was from our existing investors.'

European Property Investors Special Opportunities 4 (Episo 4) is Tristan’s eighth fund. Its mandate is to generate a 15% triple net annual return to investors by investing in Western and Central European markets across the office, logistics, retail and residential sectors.

Tristan accepted equity commitments of €1.2 bn from 25 institutional investors into Episo 4 for a first closing. Furthermore, the manager accepted commitments from nine additional investors, subject to an agreed delivery schedule over the next 60 days, which brings the fund’s full commitment to just under its €1.5 bn hard cap limit.

Some 50% of the invested capital came from the US, 25% was from Europe and 25% from Asia-Pacific. The fund has a total of 34 investors. This compares with 36 investors participating in Tristan’s last equity raise for the Episo 3 Fund, where the proportions were 40% US, 40% Europe and the Middle East, and 20% Asia.

Episo 3 had a final closing at €950 mln in January 2014 and this fund has been fully committed to over 30 investments across Europe.