Dune Tops Fund's Target with $960M Close

NEW YORK CITY—Dune Real Estate Partners LP said Tuesday afternoon it had closed its third real estate fund, Dune Real Estate Fund III, at $960 million, well above the fund's $850-million target. The Wall Street Journal reported that institutions played a larger role in the new fund than in previous ventures, with about 80% of the capital commitments coming from state pension funds and other large investors.

Already, Fund III has committed about $263.5 million to eight investments across the US, including a residential portfolio in Las Vegas, a high-end Los Angeles retail portfolio, industrial properties in Oakland and a luxury condominium development in Miami. In common with its predecessors, Fund III is aimed at distressed, deep value-add and contrarian investments, primarily in the US.

“We view our investors' enthusiasm as a strong endorsement of our investment approach,” says DREP founder and CEO Daniel Neidich. “We see tremendous opportunities ahead and look forward to putting Fund III to work.”

The new fund was raised in collaboration with Boston-based Monument Group, in common with previous funds. Lori Campana, managing director at Monument, says the fundraise's success is “a testament to the Dune team, whose depth and breadth of experience positions Fund III to deliver strong performance results for investors.”

Since its founding in 2004, DREP has raised $2.5 billion of equity capital and currently manages $3.6 billion of assets. Among its other properties are the Standard Hotel on the High Line in Manhattan, co-developed with Andre Balazs; the Mark Hotel on Manhattan's Upper East Side; the 56 Leonard St. condo property in Lower Manhattan; and the McArthurGlen Europe joint venture to develop a series of high-end designer outlets shopping centers across Western Europe.