Kayne Anderson to launch $1bn Fund IV

The niche real estate investment manager will be launching its latest and largest offering in September, with an increased focus on healthcare-related properties.

Kayne Anderson Real Estate Advisors plans to launch its latest opportunistic real estate vehicle in early September, PERE has learned. According to a source familiar with the situation, the Boca Raton, Florida-based real estate arm of Kayne Anderson Capital Advisors is aiming to raise $1 billion for Kayne Anderson Real Estate Partners IV, representing its largest equity target ever. The firm declined to comment to PERE
Fund IV is seeing strong interest from Kayne Anderson’s prior investor base, and the firm is said to have soft-circled commitments for about half of the fund’s target already, according to the source. The firm’s previous fund, Kayne Anderson Real Estate Partners III, was far oversubscribed upon its closing in May 2013, attracting more than $1 billion in commitment in just four months but closing at its $750 million hard cap. With expectations for equally strong demand for Fund IV, Kayne Anderson is speaking to a limited number of strategic new limited partners.
With the latest offering, Kayne Anderson is pursuing a similar strategy to that of its previous fund, focusing on senior housing, medical office and student housing. The capital raised for the fund likely will be invested within 18 to 24 months after the fund’s first investment and, like with previous vehicles, Fund IV is targeting a 20 percent gross return and a 15 percent net to investors. 
In October, Kayne Anderson made news with its first move into the senior housing market. The firm purchased the Aston Gardens senior housing portfolio with operator and developer Discovery Management Group, buying out Discovery’s existing partner in the portfolio for approximately $413 million.