Ellis Short, a former leading principal at private equity real estate giant Lone Star Funds, has raised $1.5 billion for the debut fund of his new company Kildare Partners in just five months, in one of the swiftest capital raisings for private real estate investment since the global financial crisis.
PDI sister publication PERE understands Kildare European Partners (KEP) has been so popular among investors that there are investors behind approximately $1 billion of additional capital seeking to be in the fund.
Kildare agreed with KEP's early investors in the vehicle that it would impose a hard cap on the vehicle at $2 billion, meaning those investors have only $500 million of units to compete for.
It is unclear how Kildare will deal with its impending over-subscription as Kildare declined to comment when approached. However it is thought that a resolution is expected within a month as the firm brings the fundraising to a close.
KEP I is expected to be used to buy distressed real estate loans from lenders in Europe. Kildare already has been actively deploying the seven-year vehicle’s capital and is understood to be invested in several transactions so far.
These include the £52 million (€62.14 million; $86.3 million) direct acquisition of Park Street, an office in London’s Mayfair, from a Danish pension fund. That deal, however, is expected to be one of the smaller outlays made for the fund with typical transactions being around $200 million in size.
Besides the UK, the firm is expected also to hunt non-performing credit from lenders elsewhere in Europe, including Ireland and Germany too.
Short led Lone Star in Asia before retiring from the business in May 2008. In the years immediately after, he remained behind the scenes to work through the firm’s acquisition of Korea Exchange Bank. After thwarted sales to HSBC and Kookmin Bank fell through, Lone Star eventually sold the bank to Hana Financial Group in 2012, freeing Short to set about forming Kildare Partners, which PERE revealed last year.