Prudential Real Estate Investors has raised $805 million in discretionary capital for its Prudential U.S. Real Estate Debt Fund, the New York Observer reported.
Investors in the now-closed fund include pension funds and sovereign wealth funds, the Observer said; the fund will attempt to take advantage of the huge number of large commercial mortgages coming due in 2012 and 2013 that were originated at the top of the market and will need to be refinanced in a radically different market. Tightened credit standards have presented problems for even established developers to refinance.
Most investments in the fund will be between $10 and $65 million, the Observer said.
“In the U.S., we expect significant demand for creative debt financing as approximately $1.8 trillion in mortgage loans come due over the next several years,” Jack Taylor, head of PREI’s global real estate finance group, told the Observer. [NYO] — Guelda Voien