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EG hits $278m first close

The Sydney-based fund manager has set a $340m hard cap for the Australia-focused value-add real estate fund.

Sydney-based real estate fund manager, EG Funds Management, has reached a first close on its second Australia-focused value-add real estate fund, raising A$368 million ($278m; €248m) in equity.

The firm confirmed the capital raise from a combination of domestic and international institutional investors in an official statement.

The Yield Plus Infrastructure Fund No. 2 (YPI 2) is the second in the series of blind-pool commingled vehicles launched by EG Funds Management to invest in assets with a repositioning and redevelopment potential across Australia. The fund is understood to have been brought to market in early 2015 with a target hard cap of A$450 million.

The firm’s initial plan was to corral the full fundraising amount within a first and final close, as per earlier PERE reports, but it is now targeting subsequent closings.

So far the firm has not made any investments via the vehicle. The plan is to deploy the capital in commercial, industrial and retail assets to create a portfolio of around A$750 million. Net realized IRRs of around 14 percent are being targeted from the investments.

“EG will bring our 16 year track record in successful management of complex urban planning processes to rezone land to highest and best use alongside key infrastructure corridors,” said Roger Parker, executive director for the firm.

EG Funds Management was launched in 2000 and operates three divisions, namely funds management, advisory and property development. Its current assets under management amount to around A$2.4 billion.