Broadstone Real Estate Registers Interval Fund

Broadstone Real Estate registered a new interval fund on October 13, targeting a $1 billion capital raise. According to the draft registration statement, Broadstone Real Estate Access Fund intends to invest in a portfolio of institutional quality real estate and real estate-related investments.  The portfolio will include the following asset classes:  (i) Direct Real Estate Investments, (ii) Private CRE Investment Funds, (iii) Publicly Traded CRE Securities, and (iv) CRE Debt Investments. The minimum initial investment is $2,500 for Class W shares and $1,000,000 for Class I shares.

Read more

Versus Capital Launches Another Interval Fund

The Versus Capital’s new real assets interval fund was declared effective by the SEC on August 17, 2017. Versus Capital Real Assets Fund, LLC is seeking to raise $450 million in a continuous offering. Minimum initial investment is $10 million(RIAs can aggregate accounts to get to the minimum). The fund will have one share class. and the management fee will be 1.50% of net assets.

Versus Capital is familiar with the interval fund space. It also manages Versus Capital Multi-Manager Real Estate Income Fund LLC, an investment company with $1.7 billion in assets. See Active Interval Funds for more information on this fund.

Read more

Pathway Energy Infrastructure Converts to Interval Fund

On July 26, 2017, Pathway Energy Infrastructure’s board of directors approved the Company’s plan to convert to an interval fund. The change of this fundamental policy will be submitted to shareholders for a vote in a forthcoming proxy. The Company is also making adjustements to its investment strategy to focus on broader infrastructure opportunities. The new Company name will be “Pathway Capital Opportunity Fund.” Shareholders will need to vote on the change in an investment strategy as well. Details on the new structure and strategy are included in a draft registration statement

Read more

Blackstone Prepares For Interval Fund Launch

TweetBlackstone/GSO registered a new interval fund on June 30. The Blackstone/GSO Floating Rate Enhanced Income Fund intends to follow a familiar credit strategy, focused

Read more

RBC Subsidiary Launches Reinsurance Fund

TweetThe SEC declared the registration statement effective for The City National Rochdale Select Strategies Fund(CNRLX ) on June 22, 2017. CNRLX is seeking to

Read more

Relative Value Fund Launches

The Relative Value Fund, an interval fund seeking to raise $100 million went effective on May 1, 2017

The Fund will use a multi-manager approach, investing variety of alternative investment strategies, in pursuit of an absolute return objective.

According to the registration statement:

Read more

Comparing The New Credit Funds

With a whole slew of credit interval funds hitting the market this year, its time to compare the basic structures and fee arrangements.  The chart below consists of funds that have been declared effective within the past year, all from familiar sponsors.  Within the broader category of credit, there are a lot of substrategies, but its no coincidence, that all of the Sponsors for these funds have marketed BDCs to retail investors in the past.

Interval Funds- Credit              
Fund FS Energy Total Return Fund- A FS Energy Total Return Fund -I Griffin Institutional Access Credit Fund- A Griffin Institutional Access Credit Fund- C Griffin Institutional Access Credit Fund- I Sierra Total Return Fund Cion Ares Diversified Credit Fund
Ticker XFEAX XFEYX CRDTX CGCCX CRDIX SRNTX CADEX
Advisor FS Energy Advisor LLC FS Energy Advisor LLC Griffin Capital Credit Advisor, LLC Griffin Capital Credit Advisor, LLC Griffin Capital Credit Advisor, LLC STRF Advisors, LLC (Medley Management) Cion Ares Management, LLC
Sub-Advisor Magnetar Asset Management LLC Magnetar Asset Management LLC BCSF Advisors, LP BCSF Advisors, LP BCSF Advisors, LP NA Ares Capital
Minimum Initial Investment $2,500 $1,000,000 $2,500 $2,500 $1,000,000 $2,500 $2,500
Strategy Equity and Debt securities of natural resource companies. Equity and Debt securities of natural resource companies. High yield debt securities High yield debt securities High yield debt securities Debt and Equity Diversified Credit
Targeted Capital Raise Up to $2 billion Up to $2 billion Up to $1 billion Up to $1 billion Up to $1 billion Up to $1 billion Up to $1 billion
Redemption Program 5% per quarter 5% per quarter 5% per quarter 5% per quarter 5% per quarter 5% per quarter 5% per quarter
Offering Costs              
Maximum Total Sales Load 5.75% None 5.75% None None 2.00% 5.75%
Maximum Commission 5.00% None 5.00% None None 0.75% 5.00%
Dealer Manager Fee 0.75% None 0.75% None None 1.25% 0.75%
Distribution Fee None None None 0.75% None 0.75% of average daily net assets until cap is reached None
Shareholder servicing expenses 0.25% average daily net assets None 0.25% average daily net assets 0.25% average daily net assets None 0.25% of average daily net assets 0.25% of average daily net assets
Operating Fees/Costs              
Management Fee 1.75% of total assets 1.75% of total assets 1.85% of net assets 1.85% of net assets 1.85% of net assets 1.5% of total assets 1.5% of total assets
Contingent Deferred Sales Charge None None None 1.0% during first year None 1.0% during first year 1.0% during first 18 months
Incentive Fee None None None None None 15.0% of net investment income over 6.0% hurdle, with catch up provision 20% of net investment income over 6% hurdle, with catch up provision
Read more

Non-Traded REIT and BDC Sponsors Launching Interval Funds

Non-traded REIT and BDC sponsors are entering the interval fund space en masse. This was a key trend in 2016 and it is continuing in 2017. Here is a partial list of Non-traded REIT and BDC Sponsors with interval funds in various stages of launch.

Read more

Union Square Registers USQ Core Real Estate Fund

TweetUnion Square Capital Partners Registered USQ Core Real Estate Fund, a new interval fund. USQ Core Real Estate Interval Fund According to the Prospectus:

Read more

New Fund Launches

Four interval funds went effective on the first quarter of 2017:

Fund Name Effective Date Investment Strategy
Griffin Institutional Access Global Credit Fund 3/30/2017 Credit
FS ENERGY TOTAL RETURN FUND 3/8/2017 Credit& Equity
PIMCO Flexible Credit Income Fund 2/9/2017 Credit
Nexpoint Opportunistic Credit Fund 1/13/2017 Credit

For a complete listing of new fund launches, see Public Listing Update.

Griffin Capital and FS Investments will both be presenting on different panels at the ADISA 2017 Spring Conference. Topics include “Between Theory & Operations: A Practical Discussion of the Formation and Operation of Interval Funds” and “Running the Gauntlet: Interval Funds and the Due Diligence Process”. Highland Capital, an affiliate of interval fund sponsor Nexpoint Capital will also be at the conference.

Read more