SL Green launched a property debt fund early last year, aiming to raise at least $1 billion for the vehicle. The office landlord hit that benchmark after a flurry of commitments this week.
Marc Holliday’s real estate investment trust surpassed its $1 billion fundraising goal for the SLG Opportunistic Debt Fund, SL Green announced on Thursday. More than $500 million in commitments came this week alone.
Major investors include Israel’s Menora Mivtachim, Taiwan’s CDIB Capital Group and the Canadian pension fund Caisse de Dépôt et Placement du Québec, which committed $250 million, Bloomberg reported.
The fund is targeting high-quality assets in New York City, where the financing landscape remains hamstrung. The fund is already being deployed towards loan originations, purchasing existing loans and loan portfolios and controlling CMBS securities.
The fund came about after SL Green itself weathered a period of distress. In the summer of 2023, Fitch downgraded the credit rating of Manhattan’s largest office landlord — the second time in a year that Fitch lowered the score for SL Green — citing the risks of the office market and the company’s move toward an asset management model as concerns.
SL Green is just one of the major commercial players in the property debt sandbox.
In March, Blackstone closed on an $8 billion commercial real estate debt fund, matching its own record for the largest fundraise for that type of investment vehicle. Blackstone spent two years raising for the fund and plans to deploy the capital on original property loans and buying existing loans in North America, Europe and Australia.
While looking for opportunities of distress, SL Green is still looking to pare down its own portfolio. Last month, the office landlord began marketing its properties at 110 Greene Street in Soho and 690 Madison Avenue in Midtown, tapping Eastdil Secured to sell the buildings.
The pair of properties could fetch a combined $300 million, a source told Bloomberg.
Read more
SL Green seeks $300M for Midtown, Soho buildings
SL Green eyes $1B NYC property debt vehicle
Blackstone strikes again: New $8B debt fund matches historic high