Värde wraps up 12th flagship fund

The vehicle fell short of its predecessor’s $2bn close.

Värde Partners has closed its latest distressed debt fund with $1.74 billion of equity commitments, PERE sister publication Private Debt Investor reported Tuesday.

Värde Fund XII, the latest incarnation of the firm’s flagship fund, invests in credit, real estate and specialty finance. Fund XII’s commitments included a $200 million allocation from the Florida State Board of Administration, PDI data showed.

So far, 30 percent of the fund has been deployed, a source familiar with the situation told Private Debt Investor. The vehicle has a four-year investment period that will end in March 2020, four years from the date of first close.

Other investments, according to the statement, came from state and corporate pensions, endowments, foundations, and funds of hedge funds in North America, Europe and Asia-Pacific. Fund XII fell short of the $2 billion raised by its predecessor, Värde Fund XI.

“Fund XII continues the strong legacy of Värde’s flagship funds,” Brad Bauer, the firm’s president, said. “These funds have been the cornerstone of the firm’s investing and we are excited to begin work on Fund XII’s investment mandate.”

The vehicle’s finalisation comes shortly after Ilftyn Carstairs and Jeremy Hedberg, both firm veterans, assumed the role of co-chief investment officer alongside chief executive officer and co-CIO George Hicks at the beginning of the year.

The promotions, announced in October, are part of the long-term leadership succession, the firm said at the time. London-based Carstairs joined Värde in 2006, while Minneapolis-based Hedberg started at the firm in 1997. Hicks will step down from his CIO position at the end of the year.

Last month, Värde named Brian Schmidt and Jon Fox partners at the firm. Over the course of 2017, the firm closed real estate loans in Mobile, Alabama; Charlotte, North Carolina; Kansas City, Missouri; and Phoenix, Arizona. The firm wrapped up its first real estate fund in June 2015 at $500 million.

Värde invests in real estate, corporate credit, mortgages, specialty finance, transportation and infrastructure, among other asset classes. Within real estate, the firm lends to real estate developers or managers; invests in loans and securities that are backed by commercial real estate assets; and direct investments in real estate assets or companies that develop property or originate commercial real estate mortgages.