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AllianceBernstein Raises $680 Million In First PE Real Estate Fund

April 25, 2012
AllianceBernstein closed its first private equity real estate fund, AllianceBernstein U.S. Real Estate Partners, with capital commitments of $680 million received from several large, global institutional investors, including Temasek, the Singapore-based investment company, Alberta Teachers Retirement Fund, as well as institutions from the U.S., Hong Kong and Japan.

In addition, AllianceBernstein said many of its private clients and employees also made commitments to the fund. With additional co-investment capital from key strategic investors, the fund could have approximately $900 million of available equity.

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The fund represents an important milestone for AllianceBernstein, which formed the Real Estate Group in September 2009.

"As a first time fund, we are thrilled with the success of our capital raise within a very difficult fundraising environment," said Brahm Cramer, co-CIO of the AllianceBernstein Real Estate Group.

To date, the fund has committed more than $200 million of equity across six separate transactions. These investments include recapitalizations of distressed loans secured by office buildings in San Jose, CA, and suburban Seattle, a limited service hospitality portfolio and a residential land site in New Jersey. The fund has also made direct real estate acquisitions including multifamily portfolios in Manhattan and in the Southeast U.S.

"We believe the current investments confirm our ability to execute our strategy and to generate attractive risk-adjusted returns through the resolution of situational distress," said Jay Nydick, the Real Estate Group's co-CIO.

The fund is actively seeking debt and equity investment opportunities across all property types and geographic locations throughout the United States with a current focus on the recapitalization of distressed assets. The fund is looking to make investments of $20-100 million per transaction and expects to invest in partnership with talented local market operators, existing owners of assets and in conjunction with borrowers seeking to recapitalize assets or entities.

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