Quadrant Real Estate Advisors has raised $120m for a US-focused real estate debt fund as it aims for a first close.
The Atlanta-based firm is looking to raise up to $700m for its Enhanced Debt Fund, IP Real Estate understands.
US pension funds are among those to have backed the strategy, which will originate and securitise fixed-rate real estate loans in the US. A first close of the fund is due this quarter.
Quadrant will look to sell off lower-yielding senior tranches and retain junior loans, which traditionally offer higher returns.
The move by Quadrant, which is also active in the UK and Ireland, comes at a time of yield compression in US debt market, with mezzanine lenders less active and leverage levels rising.
As reported last year, debt investing is once again popular in the US, with specialised entrants filling the void left by the withdrawal of banks hobbled by new risk regulation.