The entire real estate private equity fundraising market is slowing down, so it makes sense the number of real estate debt investment funds, as well as the amount of capital they are raising, is decreasing. What is interesting is, in the first five months of 2016, the percentage of debt-only and debt-plus-equity funds have increased their share of the market compared with 2015, according to Institutional Real Estate, Inc.’s FundTracker database. The ratio of debt funds to equity had been falling since 2013, but we might be seeing the beginning of a reversal in that trend line.

According to the FundTracker database, 296 real estate funds closed between Jan. 1, 2014, and June 3, 2016. Of those, 54 funds (18 percent) were focused exclusively on debt. An additional 41 funds combined debt and equity in their mandates. All together, these debt strategies represent 32 percent of the funds closed in the past two-and-a-half years.

In the first five months of 2016, 22 percent