SL Green Realty, one of New York City’s largest commercial landlords, has raised more than $1 billion for a debt investment fund aimed at acquiring distressed real estate loans across New York City.
The SLG Opportunistic Debt Fund, launched in late 2023, is designed to capitalize on what the REIT describes as a growing gap between improving leasing demand and relatively constrained lending markets. The fund focuses on commercial office and retail properties across the five boroughs and targets structured debt investments such as direct loans or the purchase of existing loan portfolios.
The new capital commitments come from a diverse mix of global institutional investors, including public pension funds, life insurers and wealth management platforms that specialize in high-net-worth clients. The company raised over $600 million for the fund in the past month, a person familiar with the matter told Bloomberg.
“The strong global demand underscores the market’s confidence in SL Green’s ability to source and execute high-conviction opportunities in New York City,” said Young Hahn, senior vice president at SL Green.
The fund’s first major backer was Canadian pension giant Caisse de Dépôt et Placement du Québec, which contributed $250 million as an anchor commitment in December. Other investors reportedly include Menora Mivtachim, a major Israeli insurer and Taiwan-based CDIB Capital Group, a source told Bloomberg.
SL Green has long positioned itself as a key player in New York City’s real estate capital markets. Harrison Sitomer, the firm’s chief investment officer, said that the fund’s early success reflects “an overwhelming appetite” from both domestic and international investors seeking exposure to New York’s commercial property market. “It is especially gratifying to work with so many existing institutional partners, while bringing on capital from new relationships as well,” he added.
The REIT noted that the new vehicle represents a significant step in expanding its asset management business. The fund's strategy aims to capitalize on discounted commercial loans in a market where property values have come under pressure, but leasing activity has shown signs of strength.
While New York's office market continues to wrestle with long-term questions around remote work and space demand, investors backing SL Green's debt fund appear to be betting on a recovery—and on the firm's ability to navigate a complex environment.
Additional investor commitments are expected to close in the coming weeks, potentially exceeding the fund's original fundraising target, according to a source speaking with Bloomberg.
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