Commercial Real Estate Debt Fund II (CREDF II) is focused on the UK commercial property market. It follows the successful deployment of CREDF I, a £130m fund launched three years ago, and CREDF-S, a £35m fund raised from existing investors in 2016.
The two funds have completed over £420m of lending, secured against commercial real estate across mainland UK. CREDF I has returned a gross IRR of 12.6% to June 2017.
CREDF II is targeting £200m at final close, which will provide sufficient funding to complete loans with a combined value in excess of £500m over the next three years.
Ludo Mackenzie, head of commercial property at Octopus Property and manager of the Commercial Real Estate Debt Funds, said: “Repeat commitments from CREDF I investors, together with new investment, are testament to the continued strength and growth of the business as well as the successful track record of CREDF l and CREDF-S. There remains a real need for commercial property finance in the UK market, and we have built a reputation and track record of delivering bespoke solutions, quickly and efficiently.”
He added: “From a borrower’s perspective, we provide loans that are more versatile than traditional bank finance and cheaper than private equity. From an investor’s perspective, CREDF I has been able to deliver returns that are comparable to equity funds, but with stronger downside protection.”
Mario Berti (pictured), CEO of Octopus Property, said: “CREDF II is an exciting opportunity for our commercial lending team, who have demonstrated their ability to deploy capital across a range of lending opportunities and deliver attractive returns.”