Fortress’ debut infra fund closes on $995m

Fortress Investment Group has raised $995 million for the Fortress Worldwide Transportation and Infrastructure Investors (FTAI) fund, its maiden infrastructure vehicle.

Launched in 2011, FTAI was originally raised as a $395 million fund – an amount the asset manager had reached in February 2013, according to a statement issued by the New York-based asset manager on Thursday. But this initial close was followed by a subsequent ‘top up’ private capital raise of $600 million of additional commitments, allowing it to reach its cap of $995 million.

FTAI's portfolio includes aviation, shipping, offshore energy and rail assets and infrastructure, such as airplanes, jet engines, shipping containers, and intermodal equipment.

“The environment for investing in transportation assets and infrastructure remains strong,” Fortress’ co-chairman and head of private equity Wes Edens said. “We’re pleased with the fund’s investments to date, and so are our investors, as evidenced by this successful ‘top up’ capital raise.”

The Washington State Investment Board (WSIB), which manages 17 state retirement and public funds, is one of the fund’s investors. In April, Infrastructure Investor reported that WSIB had approved an initial investment commitment of up to $100 million and up to another $50 million for follow-on investments.

In May 2013, the firm had said it would launch a second global infrastructure fund, Fortress Investment Partners (FIP), which had a target of $1 billion. 

“FIP and FTAI were originally going to be two separate but complementary funds, with FIP focusing on transportation and infrastructure operating companies and FTAI investing in transportation and infrastructure assets,” a spokesperson for Fortress told Infrastructure Investor on Friday.

“FIP never closed as a fund and instead its business strategy got folded into FTAI – so FTAI has a remit to invest in both operating companies (e.g. airports) and assets (e.g. airplanes),” the person explained.

Fortress was co-founded in 1998 by Edens, a former BlackRock Financial Management partner, along with Randall Nardone and Robert Kauffman, previously at UBS. The firm then launched a hedge fund business in 2002, and by the time the company held its initial public offering (IPO) in 2007, it had evolved into a diversified asset manager.

Today it manages approximately $63.8 billion on behalf of 1,600 institutional clients and private investors worldwide across a range of private equity, credit, liquid hedge funds and traditional asset management strategies. It is listed on the New York Stock Exchange.”