Wheelock Street Capital is expected to close its second commingled fund by the end of December, less than three months after the fund’s initial closing, PERE has learned. The Boston- and Greenwich, Connecticut-based private equity real estate firm, which held a first close for Wheelock Street Real Estate Fund (REF) II on $200 million in early October, plans to hold a final close for the oversubscribed fund on more than $630 million in equity later this month, according to sources familiar with the situation. Wheelock could not be reached for comment by press time.
According to pension documents, REF II has brought in multiple follow-on commitments from investors in Wheelock’s first offering, REF I. At its November 21 investments committee meeting, the New Mexico Public Employees Retirement Association committed $50 million to REF II, while the Phoenix City Employees’ Retirement Board committed $30 million at its November meeting.
According to investment manager George Fitchet, Phoenix was eager to re-up with Wheelock due to its “excellent experience” with REF I. The $2.1 billion city pension committed $20 million to Wheelock’s maiden vehicle in 2011.
Wheelock closed its first fund on $525 million in July 2012, surpassing its initial hard cap of $500 million. Fitchet told PERE that REF II will follow a similar strategy to REF I, which targeted opportunistic returns through distressed properties, high-yield debt, preferred equity and equity investments. Wheelock takes on the role of both operator and allocator for its funds, functioning as an operator when it invests through its in-house hospitality and residential land platforms and as an allocator through joint ventures with third-party managers for investments in other property types.
Wheelock’s impressive fundraising for REF I earned the firm a spot in PERE’s ‘Emerging Managers to Watch’ list in December 2012. Although REF I was Wheelock’s first commingled fund, the firm previously had raised two investment vehicles of $100 million and $150 million through a joint venture with Boston-based hedge fund manager Baupost.