South Korea’s Construction Workers Mutual Aid Association (CWMAA) has selected Park Square Capital and Goldman Sachs to manage its $70 million allocation to private debt, according to a CWMAA source.
The retirement fund will allocate a maximum of $35 million each to Park Square Credit Opportunities Fund III and Goldman Sachs’ Broad Street Real Estate Credit Partners III.
This is CWMAA’s first commitment to blind-pool funds for cross-border alternative investments. To-date, CWMAA’s allocation to alternative investment accounts for only 10 percent of its overall portfolio compared to the average of 20-30 percent by other Korean institutional investors. The fund will gradually increase its allocation to alternatives this year, according to the same source cited above.
London-based credit provider Park Square Capital has received numerous commitments from South Korean institutional investors. Last year, it received a $100 million allocation from Korea Post for a separate account to invest in the North American and European private debt markets. The manager’s €500 million Park Square Credit Opportunities Fund III also received $20 million from South Korea’s Public Official Benefit Association (POBA) to invest in senior corporate debt in Europe.
Broad Street Real Estate Credit Partners III had raised $993 million by last month, according to a US Securities and Exchange Commission filing. The fund targets senior and mezzanine loans backed by North American and European real estate and the target size has not been disclosed.
The $2.8 billion CWMAA was established in 1998 to manage retirement savings for non-regular construction workers in South Korea.