NorthStar doubles real estate secondaries to $1.5bn

The New York-based firm this year bought from a $1bn pool of real estate fund interests from Harvard Management Company.

NorthStar Realty Finance, the New York-based commercial real estate firm, has almost doubled the amount it invests in real estate fund interests on the secondaries market.

As of 30 June, publicly-listed NorthStar had $1.5 billion invested in ‘private equity investments’, accounting for 7.4 percent of the firm’s assets, according to a second-quarter earnings report filed with the US Securities and Exchange Commission on Monday. The firm defines private equity investments as interests in real estate private equity funds acquired in the secondaries market.

The firm had invested $845 million in private equity investments as of 30 June last year.

“As we have seen private market values in commercial real estate continuing to grow, our private equity investments will continue to be a unique beneficiary, which will translate into future growth and earnings from these investments,” NorthStar president Albert Tylis said in an earnings call last Thursday.

Last week, the firm announced it had invested $353 million in real estate secondaries during the second quarter of 2015.

NorthStar purchased real estate fund interests from Harvard Management Company when the endowment manager put a $1 billion pool of stakes on the market earlier this year, Secondaries Investor reported.

About 86 percent of NorthStar’s $20 billion of total assets as of 30 June were comprised of direct and indirect ownership interests in real estate.