Cerberus raises nearly $3B for new real estate fund

Funf will target non-performing or defaulted loans, among other assets

National /
Mar.March 30, 2021 06:00 PM
Cerberus Global Investments President Lee Millstein
Cerberus Global Investments President Lee Millstein

Cerberus Capital Management has raised about $2.8 billion for a new real estate fund — exceeding its target of $2 billion.

The fund, known as Cerberus Institutional Real Estate Partners, will focus on investing “opportunistically,” according to a release. That means looking at direct assets as well as entities with significant real estate exposure and debt, including non-performing or defaulted loans.

The company did not give much detail about how it will invest this money or which assets or debt opportunities it is targeting. But its launch comes at a time when investors have yet to see the wide-scale distress opportunities that were predicted as a consequence of the pandemic. Apocalyptic projections about fire sales, meanwhile, have yet to come true.

U.S. private equity funds had more than $250 billion to spend on commercial real estate loans as of March 23, according to Preqin. About $76 billion of that was earmarked for distressed debt.

“There are market dislocations and macrotrends that are driving compelling opportunities across our broad platform,” Lee Millstein, president of Cerberus Global Investments and its global head of real estate, said in a statement.

Cerberus is a prolific investor in non-performing loans, or loans that are in default. Since 1998, it’s invested approximately $21.3 billion in equity into nearly 250 non-performing loan transactions, according to its website.

The company is also betting on logistics and industrial investments, one of the industry’s hottest sectors during the pandemic. An affiliate of Cerberus and Stonemont Financial Group recently formed a joint venture to acquire as much as $1 billion in industrial real estate.

A Cerberus entity and Highgate also recently acquired six hospitality portfolios from Colony Capital, according to a news release. In total, the firm’s real estate platform manages about $26 billion in assets.






    Related Articles

    arrow_forward_ios
    Hudson Pacific Properties CEO Victor Coleman with 3400 Hillview and 3176 Porter (Getty, HPP)
    Hudson Pacific posts profit after 2 straight quarters of losses
    Hudson Pacific posts profit after 2 straight quarters of losses
    Mariposa on 3rd
    CGI Strategies secures $42M loan on Koreatown apartment complex
    CGI Strategies secures $42M loan on Koreatown apartment complex
    Gov. Gavin Newsom with Doug Ose and John Cox (Getty, Twitter)
    Real estate execs among challengers in Newsom recall
    Real estate execs among challengers in Newsom recall
    2575 E El Presidio Street and Thor Equities Chairman Joe Sitt
    Thor Equities pushes into LA industrial market
    Thor Equities pushes into LA industrial market
    Rendering of the new Pasadena office and existing building inset. (JLL, 101 South Marengo)
    Let there be light: Atlas Capital will overhaul windowless Pasadena office block
    Let there be light: Atlas Capital will overhaul windowless Pasadena office block
    PPIH President & CEO Naoki Yoshida and TPG Capital Partner Paul Hackwell (Linkedin, Getty)
    TPG Capital selling SoCal-based Gelson’s Markets
    TPG Capital selling SoCal-based Gelson’s Markets
    MDT Properties Marc Tavakoli and 627-631 N. Dillon Street (Google Maps, iStock/Illustration by Alexis Manrodt for The Real Deal)
    Shovel-ready site in Silver Lake trades for $3.5M
    Shovel-ready site in Silver Lake trades for $3.5M
    (iStock)
    LA County sued over commercial eviction moratorium
    LA County sued over commercial eviction moratorium
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...