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Debt as a strategy for private equity managers

Private real-estate fund managers have been spending billions of dollars on investments in recent months. What may surprise some readers, however, is how much of the investment strategy has been focused in upon debt.

At least three of the 10 largest private equity funds have in recent times included debt as a part of their funding strategy. Between 2012 and August of this year, a total of $38 billion had been invested by the 10 largest funds. And while Blackstone Real Estate Debt Strategies II entire investment strategy has been on debt, the amount invested in debt has been around $3.5 billion.

When speaking of investment strategies such as this, business interests are obviously in need of commercial debt collection attorneys who will aggressively protect a company's interest. Collection upon the debt needs to be acted upon promptly as delays in collecting can cause profits to suffer.

It's especially helpful to have at one's service an attorney familiar with commercial debt practices as it pertains to the real estate market and who can collect upon judgments across the country. If debt collection practices are conducted properly, costly litigation can be avoided.

Investors have been seemed confident about the opportunities in private and commercial real estate investments, but there still seems to be pessimism in the attitudes of investors. While over half of these investors believe that investments have met expectations, only one-third are seeking to make any investment commitments into the coming year. Yet capital raised in 2013 is currently 83 percent of the amount that was raised during all of 2012.

Source: GlobeSt.com, "Private Equity's Dry Powder Approaches $100B," Paul Bubny, Sep. 25, 2013

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