Normandy holds first close on third fund

Normandy Real Estate Partners has held a first close for its third fund.

Although representatives from the Morristown, New Jersey-based real estate investment firm declined to comment, sources familiar with the situation have confirmed with PERE that the firm has received approximately $150 million in equity commitments for Normandy Real Estate Fund III. 

Through Fund III, Normandy is targeting $300 million to $400 million in commitments, with a hard cap of $500 million. The minimum contribution is $10 million and, so far, the firm has received commitments from several large fund of funds and state pension plans. Fundraising for Fund III is being run by placement agent Mercury Capital Advisors.

The value-added vehicle is looking to invest in US office properties, primarily in New York, Boston and Washington DC. In addition, the fund is selectively targeting assets in Los Angeles and San Francisco. The vehicle is targeting a gross IRR of 18 percent. 

Recently, Normandy made its first investment on behalf of the vehicle. A joint venture between New York Life Insurance and an investor group led by the firm closed on the acquisition of 575 Lexington Avenue, a 639,000-square-foot office building in Midtown Manhattan, for $363 million last week. 

Formed in 2002, Normandy is led by Finn Wentworth, Jeffrey Gronning and David Welsh. The firm's previous vehicle, Normandy Real Estate Fund II, was launched in 2007 and closed on $350 million in total equity commitments, according to the firm's website. 

To read PERE’s recent Blueprint interview with the principals of Normandy, click here.