KTB commits W550b to US real estate debt strategies

KTB Asset Management has closed a 550 billion won ($478.8 million) commitment to Bridge Debt Strategies Fund IV, a pooled investment vehicle mainly targeting securitized multifamily residential housing loans in the United States, the company said Tuesday.

The Seoul-based asset manager added it has attracted capital commitments from eight undisclosed South Korean institutional investors, targeting annual returns of up to 11 percent from its fund-of-funds strategy.

Bridge Debt Strategies Fund IV, managed by Salt Lake City-headquartered real estate investment house Bridge Investment Group, aims to deploy its capital to mortgage loans for multifamily housing -- usually in the form of apartment buildings -- and securitized instruments backed by the loans.

Of the total, half of its capital will go to multifamily mortgage-backed securities called K-Deals. The structured credit is guaranteed and sold by the US state-sponsored enterprise Freddie Mac.

Korean capital will take up about a quarter of the total commitment of Bridge‘s new vehicle, joined by institutional investors in the US and the Middle East, according to KTB Asset.

The latest fundraising deal “lays a foundation for Korean institutions to have a greater say in foreign capital market opportunities ranging from fund management to co-investment,” KTB Asset said in a statement.

KTB Asset has about 14 trillion won assets under management as of August. Its exposure to real assets stands at 3.6 trillion won. KTB Asset’s overseas real asset portfolio ranges from commercial properties in North America and Europe, infrastructure assets and vessels, via some 50 vehicles.

The news comes about a year after Bridge established a Seoul office in October to enhance capital-raising efforts across Asia. The Korean operation is led by Managing Director Lee Seung-hwan, former deputy chief investment officer at Korea’s sovereign wealth fund Korea Investment Corp.

Bridge has about $26 billion in assets under management as of March.

By Son Ji-hyoung (consnow@heraldcorp.com)