Hamilton Lane is in market with its latest flagship secondaries fund, targeting more than twice the amount sought for its predecessor, Secondaries Investor has learned.
Hamilton Lane Secondary Fund V has a target of $3 billion, according to two sources familiar with the fundraise. The fund has been registered in the Cayman Islands.
Its predecessor raised $1.9 billion by final close in June 2017 against a target of $1.25 billion, according to PEI data. Investors in the fund include City of Fort Lauderdale General Employees’ Retirement System, which committed $10 million, and Employees’ Retirement Fund of the City of Dallas, which committed $30 million.
The fund had returned a total value multiple of 1.27x and a net internal rate of return of 52.59 percent as of 31 March, according to data from Public Employee Retirement System of Idaho.
Around 18 percent of buyout funds of vintage 2005-08 are at or near their hurdle rate, equivalent to $45 billion in net asset value, according to research by Hamilton Lane, reported in October by Secondaries Investor. Many of these funds won’t make it through the GP catch-up period, which means that limited partners are unlikely to receive more distributions. This creates opportunity for restructurings, according to EMEA secondaries head Richard Hope.
“We’re not saying that it has got to have that 7-9 percent IRR in order to kick off a restructuring,” he said. “But we think it’s an area LPs should be thinking harder about rather than waiting and seeing what happens.”
At least seven of the top 10 largest secondaries firms are fundraising or preparing to launch flagship vehicles, including Goldman Sachs Asset Management which is seeking between $6.5 billion and $7 billion, as Secondaries Investor reported on Tuesday.
Glendower Capital is nearing the $2.5 billion hard-cap on its first fund raised as an independent firm, having raised $2 billion so far, as Secondaries Investor reported on Monday.
Hamilton Lane declined to comment on fundraising.