Beach Point Raises $1.2B For Private Credit, Plans On 'Casting A Wide Net'
Beach Point Capital raised over $1.2B to deploy into private credit, including for its first-ever dedicated real estate fund.
The Santa Monica, California-based investment manager’s BPC Opportunities Fund V LP has attracted $750M from investors while its BPC Real Estate Debt Fund pulled in $545M in investable capital.
The real estate fund will pursue a “flexible, all-weather approach” targeting U.S. middle market assets. It will focus on directly originating loans, opportunistic debt acquisitions and other special situations with equity upside, according to a release.
Beach Point, which has roughly $19B in assets under management, has some real estate exposure across its diversified funds, but the dedicated platform is being launched to take advantage of what Andrew Chen, Beach Point’s head of real estate investments, called especially attractive circumstances.
“More than $3 billion of CRE loans are expected to mature over the next five years, which combined with an uncertain macroeconomic backdrop, higher rates and reduced capital availability from traditional lenders, is driving increased demand for bespoke private solutions,” he said in a statement.
Beach Point has already deployed 56% of the capital in the real estate fund. It is sector-agnostic and is looking at both sponsored and nonsponsored transactions, Chen said.
The Opportunities Fund V was first launched by Beach Point in 2010, and the company said it has deployed some $5B through opportunistic direct lending and capital solutions. The new capital infusion is targeting the full range of middle-market private credit solutions, including highly structured transactions and moves to take advantage of market dislocations.
“By casting a wide net … we can pivot quickly to the most attractive relative value opportunities in the market as they arise and look forward to continuing to do so on behalf of our valued investors," Beach Point Head of Private Credit Michael Haynes said in a statement.
Private credit has emerged as a key leverage point in the commercial real estate debt space as U.S. banks remain sidelined by concerns over pandemic-era loans on their books and the broader macroeconomic picture.
The wall of debt maturities has only grown higher after years of loan extensions undertaken as banks and owners looked to avoid refinancing in a higher interest rate environment. But those days are likely waning, and private capital is a key tool for owners looking for capital infusions.
Big industry players are taking notice. Brookfield Asset Management purchased alternative mortgage lender Angel Oak Cos. in April, rolling the firm’s $18B portfolio into its $317B credit business.
In December, BlackRock paid $12B to buy private credit firm HPS Investment Partners in an all-stock deal.
