NXT Capital has raised $402 million for its fiftth flagship fund, putting over the halfway mark of the minimum amount it is seeking for the vehicle, according to a source familiar with the situation.
The firm set a target of $800 million-$1 billion for NXT Capital Senior Loan Fund V, as Private Debt Investor previously reported. The Chicago-based mid-market lender locked down $376.6 million for the vehicle, according to US regulatory filings, though the source said those numbers do not take foreign investors into account.
The fund series’ previous incarnation, SLF IV, closed in October on $912 million of deployable capital, consisting of $312 million in equity commitments and a $600 million leverage facility.
The firm declined to comment.
Past SLF vehicles have sought returns between 6-7 percent without leverage and 9-11 percent with leverage, according to investor documents previously obtained by PDI. The funds also have a 0.75 percent management fee levied on the fund’s assets under management. The Teachers’ Retirement System of the State of Illinois committed $125 million last month, according to June meeting minutes.
In addition, this year the firm also locked down $950 million through two separately managed accounts: one for $500 million with Aflac Global Investments and another for $450 million with an undisclosed investor, which was recently upped from $200 million, according to a source familiar with the situation. It also closed a $406 million collateralised loan obligation earlier this year.
Last month, the firm expanded its staff focused on the western US with the hiring of former CIT originator Brian Miazga as a managing director. Miazga, who also worked at Fifth Street and BMO Harris, will be responsible for new business originations as well as structuring, underwriting and closing transactions at NXT.
NXT provides financing to mid-market companies and commercial real estate investors. It is a portfolio company of private equity firm Stone Point Capital. It has offices in New York; Los Angeles; San Francisco; Dallas; Atlanta; Charlotte, North Carolina; Nashville, Tennessee; Phoenix, Arizona; and Stamford, Connecticut.
Editor's note: The total raised for Senior Loan Fund V and the smaller separately managed account have been updated to reflect additional information.