As big institutional investors pull back from investing in
high-risk real-estate funds, these funds are turning to a new source for
capital: rich people. the WSJ reports. Starwood Capital
Group, Lone Star Funds, Carlyle Group and others have raised billions of
dollars over the past several months from wealthy individuals seeking to get in
on the firms' newest "opportunity" funds, which buy or develop
riskier properties and use higher levels of debt in hopes of reaping high
returns.
Traditional investors in opportunity funds—public and
corporate pensions, foundations and endowments—reduced their allocations to the
funds or began avoiding them altogether after the funds racked up huge losses
during the real-estate downturn that started in 2008. "In their place, you've seen
high-net-worth investors….."
Learn more at http://online.wsj.com/article/SB10000872396390444443504577601902999021244.html?mod=WSJ_Markets_LEFTTopStories
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