Benefit Street Partners is prepared to deploy up to $10B for its U.S. real estate debt strategy, including $3B in equity commitments, marking the largest fund-raise in the firm's history.

The New York-based, credit-focused alternative asset manager announced the final close of BSP Real Estate Opportunistic Debt Fund II, which has $10B in investable capital across $3B in equity commitments, according to a news release. The fund is focused on originating senior and junior commercial real estate debt investments across major U.S. markets.

The fund was launched in 2023 in partnership with Franklin Templeton. BSP's first opportunistic debt strategy closed in 2022 with $518M in capital commitments, according to PERE Credit.

“The continued shift toward private credit solutions in U.S. commercial real estate lending is creating an opportunity set we believe is both compelling and enduring,” BSP CEO David Manlowe said in a statement.

Benefit Street has remained fairly active in the lending space as regional banks have reduced their commercial real estate exposure. In addition to lending, Benefit Street invests directly through its Benefit Street Partners Multifamily Trust.

The move comes as other major players have been coming into the private credit space. They see opportunity as institutional banks have become more willing to offload bad debt, opening up opportunities within the debt markets.

In July, BlackRock acquired ElmTree Funds with plans to roll the company's business into its private financing solutions platform. BlackRock also completed the acquisition of alternative credit provider HPS Investment Partners around the same time. In October, Brookfield reached a $3B deal to buy up what it didn't already own of private credit firm Oaktree Capital Management.

Benefit Street's real estate debt platform has been active since 2013 and has originated more than $30B of investments. Benefit Street is a subsidiary of Franklin Templeton, one of the largest independent investment managers, with $1.7T in total assets under management.