Lone Star closes $5.6bn debt fund

The fund, which surpassed its $5 billion target, will target opportunistic real estate, corporate and consumer debt in the North America, Latin America, Europe, and Asia-Pacific markets.

Lone Star Funds has completed a final close for its latest distressed debt fund on $5.6 billion, Private Debt Investor’s sister publications Real Estate Capital and Private Equity International reported.

The Dallas-based alternative asset manager had originally targeted $5 billion for the Lone Star X (LSF X) fund, which includes two vehicles: the Lone Star Fund X (US) and Lone Star Fund X (Bermuda), the company announced on 15 November. The final close amount includes commitments and an “anticipated co-investment from associated entities”.

The fund targets opportunistic real estate, corporate and consumer debt in the North America, Latin America, Europe, and Asia-Pacific markets, according to August meeting documents of the New Mexico Educational Retirement Board, which has made a $150 million commitment to the fund. LSF X will target a 25 percent gross return.

Other LP contributors to the LSF X fund include the Teacher Retirement System of Texas ($300 million); Chicago Policemen’s Annuity & Benefits Fund ($15 million); Los Angeles Fire & Police Pension System ($40 million); and the Teachers' Retirement System of Louisiana ($75 million), according to PDI data.

The firm launched its latest fund this June, SEC filings show. Lone Star closed the previous distressed debt Fund IX in June 2014, with $7.2 billion in commitments raised, targeting real estate, corporate, and consumer debt in the Americas, Europe and Japan, according to its website.

This April, Lone Star also closed a $5.9 billion distressed real estate fund.

Founded in 1995, Lone Star made the upper ranks of the Private Debt Investor’s top 10 fundraising rankings. The firm has $67.1 billion in assets under management.