Commercial real estate lender ACORE Capital closed its latest commercial debt fund with nearly a half-billion dollars more in commitments than expected.

ACORE raised $1.4B for ACORE Credit Partners II, blowing past its $1B target, the company announced in a press release. It is the largest private real estate debt fund to close in 2024, PERE reports.

"We believe the success of this fundraise — especially in a very difficult capital raising environment — is a testament to our track record, relationships and the incredible opportunity we see to deploy capital into transitional real estate over the next few years," ACORE CEO Warren de Haan said in a statement.

The fund received commitments from a mix of investors, including U.S. pension plans, sovereign wealth funds, endowments and foundations, insurance companies and family offices, according to the release.

"ACORE was established to serve as a reliable and trusted alternative to traditional sources of real estate debt," said Michael Romo, senior managing director and head of global capital raising and investor relations at ACORE. "The increased cost and significant reduction in the availability of debt capital from traditional lenders is creating very attractive investment opportunities for ACORE."

Debt funds have stepped up to the plate in recent years to fill financing gaps as conservative institutional lenders largely remain on the sidelines. The worldwide private debt market has skyrocketed since the Global Financial Crisis, growing from about $375B to about $1.6T in 2023, according to Preqin data reported by The Brookings Institution. BlackRock forecasts the market will top $3.5T by 2028.

ACORE, which is headquartered in the San Francisco Bay Area, has originated about $40B in loans since its formation in May 2015. The company had roughly $20B in assets under management as of Dec. 31. It originates senior and mezzanine loans and has worked across a variety of asset classes.