Canyon Partners closes $ 650 million debt fund


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Canyon Partners Real Estate has closed its largest real estate debt vehicle in the United States – Canyon Laurel Fund II – with more than $ 650 million in assets through the fund and associated co-investments.

It’s also larger than the previous $ 530 million fund, which also included related co-investments.

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The fund targets investments in senior and subordinated debt securities in major US markets and covers all major types of properties. Canyon has already deployed over 60% of the fund’s capital through a combination of primary origins and secondary market purchases.

Robin Potts, co-director of real estate at Canyon, said in a statement that the pandemic has created an even more compelling environment for real estate debt, with lenders, homeowners and developers facing growing cash needs. As we entered the pandemic, Canyon was positioned to enable it to act quickly and capitalize on growing opportunities, she added.

Robin Potts noted that about 70% of the predecessor fund also invested in the Canyon Laurel Fund II. The fund’s investor base spans the United States, Japan, Korea and Australia and includes institutional investors such as public and corporate pensions, endowments, financial institutions and family offices. .

Canyon’s direct real estate investment arm, which manages a real estate portfolio of more than $ 6 billion in project capitalization, had doubled in size in recent years under the leadership of Potts and Maria Stamolis, co-head of real estate investments.

In November, Canyon acquired a $ 314 million loan portfolio comprising six senior mortgages secured by multi-family properties, student housing, self-service warehouses and senior residences. The senior loans had terms of three to five years at variable rates and had average loan balances of approximately $ 50 million for properties in markets such as California, Colorado, Rhode Island, Tennessee and Texas. At the time, Potts said they were seeing billions of dollars in commercial mortgages hitting the market for sale as lenders repositioned balance sheets and portfolios due to the pandemic.

More funds and investments

Canyon is also active in the field of equities. In early 2020, Canyon announced an additional investment of $ 375 million from CalPERs for its Emerging Manager Program, which Canyon has managed since 2012.

In October 2019, a joint venture between Canyon and AECOM Capital announced the definitive closure of its AECOM-Canyon Partners fund, with more than $ 500 million in capital commitments. The fund targets build-to-core investments in major US markets across a range of property types, including offices and industrials. Among the fund’s largest investments is Ivy Station, a 519,000 square foot mixed-use development in Culver City, California, where HBO has leased all of the 240,000 square feet of office space.

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