Giller to leave Liquid Realty

Jeff Giller is leaving the San Francisco-based secondaries firm after four years. Josh Cleveland and Brendan MacDonald have already left. The departure triggers a key man clause in Liquid’s $570m LRP Fund IV.

Jeff Giller is to leave Liquid Realty Partners after four years as co-managing principal and chief investment officer of the San Francisco secondaries shop, PERE has learnt.

Liquid’s director of business development Josh Cleveland and director of acquisitions Brendan MacDonald have already departed. It is unclear what the trio plan to do next. Giller, Cleveland and MacDonald all declined to comment. A spokesman for Liquid also declined to comment

The decision by Giller to leave the firm has triggered a key man clause in Liquid’s $572.3 million LRP Fund IV, which closed in late 2007, according to people familiar with the situation. The fund is believed to be substantially invested.

Limited partners were informed of Giller’s decision to leave two months ago. Giller remains at Liquid for the time being, winding down his responsibilities. No date has been set for his departure, although it is expected to be imminent.

Founder and chief executive officer Scott Landress will take over much of Giller’s responsibilities, backed by existing members of the Liquid team. The firm is believed to have spent much of the past two months talking with investors to help them get comfortable with the transition.

In June, PERE revealed that Liquid was planning to raise its fifth vehicle, targeting $800 million. If successful the fund would be the largest-ever private equity real estate secondaries fund.

Liquid was founded in 2001 by Scott Landress and Mark Berman. Berman left in 2005 and set up WRB Capital Group, which operated for two years, targeting single-tenant triple-net lease properties. According to his LinkedIn profile, Berman is now managing partner of the multi-family office platform MB Family Advisors, managing the distressed credit fund of funds, MB Dislocation Opportunity Fund.

Secondaries activity in private equity real estate funds has been slow to get off the ground in the wake of the credit crisis, with limited partners often unwilling to accept the steep discounts being offered for fund interests. With the denominator effect now easing and few capital calls being made, the pressure on LPs to sell has also lifted in the past few months.

However as fund managers start to deploy capital and make capital calls, industry professionals expect secondaries deals to rise as cash-strapped LPs search for liquidity.