Pembrook sets its sights on $450m for Fund III

The US real estate financing firm is looking to raise more than three times the amount garnered by its second fund in 2010.

Real estate debt financing specialist Pembrook Capital Management has launched fundraising for its third fund.

Pembrook, which was founded in 2006 by Stuart Boesky and has offices in New York and Boston, is targeting $450 million for PCI Investor Fund III, according to sources with knowledge of the process. The amount represents a threefold increase on the size of its predecessor. The firm declined to comment.

The fund has a hard cap of $650 million, and features a split between around $300-500 million of common interest stock together with an additional layer of lower-yielding, limited covenant, preferred stock to provide additional leverage. Lastly, the firm will have the option to raise up to $150 million in additional leverage.

An affiliate of the Mariner Investment Group is helping to place the fund, a source said.

Pembrook’s second fund, a 2010-vintage vehicle, raised $154 million.

The new fund’s strategy is largely similar to Fund II: capital will be used to finance first mortgage and mezzanine loans as well as bridge financing. Pembrook positions itself as a lender to transitional real estate deals that the US banks won’t now do due to regulatory constraints.