Fundraising - APRIL 20, 2015

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TIAA Henderson Real Estate holds first close for debt fund

by Andrea Waitrovich

TIAA Henderson Real Estate has completed a first close of £138 million ($206 million) for its U.K. Enhanced Debt Fund. TH Real Estate launched its first commercial real estate debt fund in December 2014 with a focus on the U.K. market.

The capital for the initial close has been committed by TIAA-CREF, TH Real Estate and Aviva Investors Real Estate Multi Manager. The fund is designed to produce net returns of 6 percent to 7 percent IRR with a 6 percent distribution yield.

The six-year fund invests in whole loans and selective mezzanine loans up to 75 percent loan-to-value. Loan origination is focused on prime and strong secondary assets, as well as well-positioned regional assets in the core-plus and value-added segments of the U.K. market. The fund can selectively syndicate the senior portions of whole loans to enhance returns and optimize its investment portfolio.

The fund will leverage the internal debt, portfolio management and direct investm

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