Singapore-based fund manager Pierfront Capital has raised US$200m in the first close of a new private credit fund, which will provide financing to real estate and other real asset sectors across Asia Pacific.
The fund is jointly sponsored by a Pierfront’s first fund, Pierfront Capital Mezzanine Fund (PCMF), and Singaporean asset manager Keppel Capital, which recently completed the acquisition of a 50% interest in Pierfront.
The fund launch comes after Pierfront received its capital markets services license from Singapore’s financial regulator.
“Private debt is a growing asset class, particularly in today’s environment in Asia-Pacific, where we have observed considerable demand for alternative lending solutions to meet capital needs of corporates and projects in real asset sectors, arising from the structural tightening of traditional bank lending in select markets,” said Keppel Capital CEO Christina Tan.
“We believe that this increasing demand for alternative lending solutions, coupled with the Keppel Group’s capabilities and PCMF’s track record in credit investments, positions the Fund well to capture opportunities in Asian private debt markets.”
Keppel Capital and PCMF have each committed US$100m to the first close.
The new fund will provide loans to corporates or projects predominantly in real asset sectors such as real estate, infrastructure, offshore marine, transportation, energy and natural resources.
Pierfront said its first fund, PCMF, had committed almost US$400m across 15 investments since 2016, achieving over mid-teens gross internal rate of return.
Singaporean sovereign wealth fund Temasek owns a 90.91% stake in PCMF, and Sumitomo Mitsui Banking Corporation owns the remaining interest.
“The ability to leverage Keppel’s capabilities and networks to gain access to a wider pool of deal opportunities and enhanced market intelligence, especially in times of uncertainty, puts us in good stead to continue executing private credit investments that provide attractive risk-adjusted returns to our investors,” said Pierfront Capital CEO and CIO Stephane Delatte.
Keppel Capital has S$33bn in assets under management, and is the asset management arm of Keppel Corp.