Madison Realty Capital debt fund raises $695M

Lending fund exceeds $600M goal, will originate mortgages loans and mezz debt
May 10, 2016 12:30PM

Madison Realty Capital closed off its latest debt fund after raising $695 million – “substantially exceeding” an initial goal of $600 million, the real estate investment and lending firm said Tuesday.

The fund, Madison Realty Capital Debt Fund III LP, is the firm’s third institutional debt vehicle and raised money from “a diverse group of investors” including public and corporate pension funds, foundations and endowments, and asset managers.

MadisonTRData LogoTINY closed the $695 million fund after “surpassing our initial [$600 million] target by a considerable margin,” company managing principal Adam Tantleff said in a statement.

The debt fund originates commercial mortgage loans, mezzanine loans and preferred equity interests while also acquiring “non-performing mortgages,” Madison said, and has “more than $2.5 billion of transaction capabilities.”

Madison’s first debt fund, launched in 2005, raised more than $300 million, and was followed by the Sullivan Debt Fund in 2012, which raised more than $350 million.

The firm’s total assets “now approach $3 billion,” Tantleff added, with Madison looking to “find and exploit” investment opportunities “in the underserved middle markets across asset classes.”

Madison recently entered contract on a pair of vacant warehouses, near the Industry City office complex in Sunset Park, for $37 million. The company also teamed with USAA Real Estate Co. in March to acquire a 16-story Midtown East rental building for $270 million. – Rey Mashayekhi