KKR closes opportunistic real estate credit strategy with $850m
KKR has raised more than $850m (£675m) at the final close of its opportunistic real estate credit fund II (ROX II).
ROX II is KKR’s flagship private fund investing across the full breadth of KKR real estate credit’s opportunistic capabilities and is dedicated to investments in senior loans and real estate securities in the US and Western Europe.
The strategy has a flexible mandate to pursue attractive risk-adjusted returns across both loans and securities. Loan originations focus on first mortgages secured by high-quality properties owned by institutional sponsors and located in major markets within the US and Western Europe.
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“We believe it is a great time to invest real estate credit. The asset class offers attractive absolute and relative returns, underpinned by the opportunity to lend on high-quality, well-located assets at conservative leverage levels on re-set property values,” said Matt Salem, partner and head of real estate credit at KKR.
“We have designed our ROX II strategy with a flexible mandate to participate in what we view as the best risk-adjusted opportunities we see across our platform, with the objective of delivering attractive returns coupled with significant current income and a focus on downside protection.”
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“Our extensive borrower relationships, built over the past decade, have enabled us to continue our disciplined deployment into an attractive market,” said Joel Traut, partner and head of originations for real estate credit at KKR.
“We believe private capital will play an increasingly important role in the commercial real estate market as loan demand continues to climb, and this positions us very well to deliver attractive risk-adjusted opportunities for our investors.”
Since 2015, KKR’s real estate credit strategy has originated $43.4bn of loans and invested $14bn in commercial mortgage-backed securities.
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