European investment manager ARA Venn, a majority-owned subsidiary of Singapore’s ARA Asset Management, has raised 200 million euros ($225 million) for the first close of its latest real estate debt fund, according to a press statement.
Venn Commercial Real Estate Fund II (VeCREF II) secured capital commitments from cornerstone investor ARA Asset Management and all external investors in its predecessor fund, including pension funds from the UK and North America.
Prior to VeCREF II, ARA Venn had deployed more than 520 million euros ($585 million) across 24 commercial real estate loans through VeCREF I in 2016. The first fund was focused on the UK and select Western European commercial real estate markets.
The latest fund will invest in whole loans secured by commercial real estate assets across Western
Europe, targeting a net internal rate of return (IRR) of mid to high single digits, the statement said.
It will target loans secured by value-add real estate opportunities across all asset classes, including residential and alternatives, with a focus on France, Germany, Ireland, the Netherlands, Spain and the UK.
“We believe (VeCREF II) will be very interesting for non-bank lenders who are unencumbered by legacy loan assets and who will, therefore, be able to assist with financing requirements when others are less able to,” said Paul House, Joint Managing Partner and Head of the Commercial Real Estate team at ARA Venn.
Following the first close of VeCREF II, the firm is “currently analysing a number of exciting opportunities to deploy capital into a market which promises to be very attractive for real estate debt in relative value terms,” Beatrice Dupont, Partner in the Commercial Real Estate team, said.
Founded in 2009, ARA Venn has assets under management and active mandates totalling in excess of 5 billion pounds ($6.2 billion). ARA bought a majority stake in the firm, formerly known as Venn Partners, this year.