Patron Capital raises €895m for its third private equity real estate fund

The London-based firm has closed its largest fund to date after receiving commitments of nearly €900m, almost three times the size of its previous vehicle.

Patron Capital, the Europe-focused private equity real estate firm, has closed its third fund with total commitments of €895 million ($1.2 billion).

In a statement, the firm said that the fund would be invested across western, central and eastern Europe.

Patron, a London-based firm founded by Keith Breslauer, said the fund had been four times oversubscribed. “While we appreciate this tremendous interest, the size of the fund has not been increased as Patron is determined to remain specialist and focused on opportunistic investments that are within the strategy,” Breslauer said.

The fund’s acquisition strategy will be the same as Patron Capital Captive Fund, Patron Capital I and Patron Capital II, which delivered a weighted average investment performance of 64 percent internal rate of return.

It will target undervalued businesses with underlying real estate value, properties encumbered by complex situations, properties deemed non-core by their parent company that are valued below intrinsic value and distressed properties.

Patron, which was founded in 1999, went on the fundraising trail for its third fund in December. Monument Group is the placement agent and advisor.

Previous investments by the Captive Fund, Fund I and Fund II include the Hotel Arts complex in Barcelona, UK independent bulk liquid and gas company Simon Storage, a Polish cinema chain with 43 freehold sites that are being converted into small-scale retail centers, the Radisson SAS Carlton hotel in Bratislava and UK non-standard mortgage company igroup.

Patron Capital Captive Fund invested all its equity, €93 million, in one deal and sold out for €226 million. Fund I invested €98 million in 13 deals and has thus far returned €151 million to investors. Fund II, the largest out of the three funds, raised €329 million and has €233 million in 13 deals.

Outside the three funds, the firm owns a majority stake in listed French real estate business Vectrane worth €277 million, which Patron took onto the French stock exchange as a French REIT.

The firm is headquartered in London, and has associate offices in Barcelona, Milan and Warsaw.