La Banque Postale Asset Management (LBPAM) has so far reached €533 million for two debt funds dedicated to real estate and infrastructure.
The firm has not specified the breakdown between the two funds, although it is understood that the total raised is split relatively evenly, putting the amount allocated to both real estate and infrastructure at around or just over €250 million.
The two funds have been raised simultaneously by LBPAM’s private debt team, which was established in 2012 to focus on investments in debt secured by real assets. The firm has already invested its maiden real estate and infrastructure debt funds, with around €1.2 billion invested across its private debt platform including multi-investor and dedicated funds.
French insurer CNP Assurances is the principal sponsor of the new funds, as was the case in LBPAM’s previous funds.
The real estate debt fund will target senior secured loans backed by mainly offices, retail and residential property in France, the Benelux and Germany. A small allocation within the fund will be able to invest in locations including Spain and Italy and sectors including logistics, healthcare and hotels. It will focus on properties with stabilised cash-flows and will not finance development.
LBPAM will target average loan sizes of between €20-50 million, rising to in the region of €100 million with co-investment from dedicated funds. Loan-to-value ratios will be up to 65 percent for core properties and targeted spreads are in the region of 150-170 basis points. Loan terms will be on average four years.
A second close is targeted during Q2 2016 and the ultimate target for both the real estate and infrastructure funds is €900 million.
“These funds meet the expectations of our institutional clients in diversification into yield-producing real assets providing a quality risk profile. Private debt investment is also particularly relevant in volatile market periods,” said René Kassis, head of private debt management at LBPAM.