Mpls. Investment Firm Nearly Doubles Funds On Recent Deal

Mpls. Investment Firm Nearly Doubles Funds On Recent Deal

Castlelake recently closed on $1.4 billion in new capital commitments, bringing its total managed assets to $3.6 billion.

Minneapolis-based investment firm Castlelake announced Wednesday that it closed on a $1.4 billion distressed-debt fund, well over its previous target of $1 billion.
 
The firm said its main focus areas for the fund will be within “European non-performing loans, global aviation, U.S. distressed asset opportunities (including commercial & industrial loans, small balance CRE loans, and residential land), and dislocated industries.”
 
Contributors to the new fund, dubbed Castlelake III, included endowments, foundations, family offices, sovereign wealth, and domestic and international pension funds.
 
The new fund now represents about 40 percent of the total assets that Castlelake manages.
 
Rory O’Neill, who previously led Minnetonka-based Cargill’s global credit strategies business, founded Castlelake in 2005.

 
“The successful close of Castlelake III is evidence of investors’ confidence in our team and its experience as opportunistic investors,” O’Neill, managing partner and CEO of Castlelake, said in a statement. “We look forward to generating strong and stable value for our investors over the life of the fund, and continuing to differentiate Castlelake as the leader in distressed, asset rich investment opportunities in Europe, the U.S., and global aviation.”
 
According to Bloomberg, the firm’s previous fund, Castlelake II raised about $1 billion by its close in October 2012 and last year was generating an internal rate of return at 23 percent. In 2007, the firm’s Castlelake I fund raised $475 million and was generating a 5.8 percent return rate as of last year.
 
Castlelake has about 60 employees at its Minneapolis and London offices.