Aermont seeks €1.6bn for real estate debt, equity

The firm is seeking €100m more than it raised in its previous fund.

Aermont Capital, formerly Perrela Weinberg’s real estate arm, is in the market with its fourth fund – which will target real estate debt and equity transactions, according to documents from the New Mexico State Investment Council (SIC).

The London-based firm is seeking €1.6 billion for Aermont Capital Real Estate Fund IV, a vehicle that will deploy capital into western Europe’s “most prominent” cities, read the materials for the Albuquerque-based limited partner’s Tuesday meeting. The SIC is considering a €75 million commitment to the fund.

Fund IV, to which Aermont will contribute at least €20 million, will target a gross internal rate of return in excess of 20 percent with a net 15 percent internal rate of return. Partners Léon Bressler, Paul Golding, Vincent Rouget, Nathan Shike and Alison Trewartha make up the fund’s key-person clause.

Aermont did not respond to request for comment.

Fund IV’s investment themes include focused strategies targeting structural economic themes, investments in prime assets or projects in marquee European cities and business plans that focus on improving operations. Fund III, launched in 2015, raised €1.5 billion.

Real estate debt fundraising by region – where a firm plans to deploy capital rather than where the vehicle’s investors are – has fluctuated over the past four years. Europe-focused vehicles raised 21 percent of the total amount locked down this year, while that total stood at 16 percent and 35 percent for 2016 and 2017, respectively.

One constant in real estate debt fundraising has been the rise of North America. Vehicles centred on the continent made up slightly more than one-in-five dollars raised in 2014 and had risen to almost one-in-two dollars collected in 2017, when it also made up a plurality of the capital raised.

For the real estate sector, debt funds have been a bright spot in real estate fundraising, with a record $30.53 billion garnered for the strategy in 2017, according to data from Private Debt Investor sister publication PERE. Of the 2,958 closed real estate funds in PERE’s database, 419 are real estate debt funds.

Lisa Fu contributed to this report.