KKR announced the final closing of the KKR Opportunistic Real Estate Credit Fund II (ROX II), a strategy dedicated to opportunistic investments in senior loans and real estate securities in the U.S. and Western Europe. And the closed commitments to the comingled fund and separate accounts pursuing KKR’s Opportunistic Real Estate Credit Strategy total over $850 million.
ROX II is KKR’s flagship private fund investing across the full depth of KKR Real Estate Credit’s opportunistic capabilities. This strategy has a flexible mandate to pursue attractive risk-adjusted returns across both loans and securities. Loan originations will focus on first mortgages secured by high-quality properties owned by institutional sponsors and in major US and Western European markets.
Over the past decade, KKR has established a leading franchise as a mortgage lender of choice to top sponsors. The securities investments will utilize KKR’s position as the largest third-party purchaser of risk retention CMBS B-Pieces and K-Star, KKR’s dedicated special servicer.
KKR’s global real estate business invests thematically in real estate through a full range of scaled equity and debt strategies. And KKR’s 140+ dedicated real estate investment and asset management professionals across 16 offices apply the capabilities and knowledge of KKR’s global platform to deliver outcomes for clients and investors. Since 2015, KKR’s real estate credit strategy had originated $43.4 billion of loans and invested $14 billion in commercial mortgage-backed securities (CMBS).
KEY QUOTES:
“We believe it is a great time to invest real estate credit. The asset class offers attractive absolute and relative returns, underpinned by the opportunity to lend on high-quality, well-located assets at conservative leverage levels on re-set property values. We have designed our ROX II strategy with a flexible mandate to participate in what we view as the best risk-adjusted opportunities we see across our platform, with the objective of delivering attractive returns coupled with significant current income and a focus on downside protection.”
- Matt Salem, Partner and Head of Real Estate Credit at KKR
“Our extensive borrower relationships, built over the past decade, have enabled us to continue our disciplined deployment into an attractive market. We believe private capital will play an increasingly important role in the commercial real estate market as loan demand continues to climb, and this positions us very well to deliver attractive risk-adjusted opportunities for our investors.”
- Joel Traut, Partner and Head of Originations for Real Estate Credit at KKR
