SEC Sets Sights On CRE Private Equity

WASHINGTON, DC—On Friday, Securities and Exchange Commission Chair Mary Jo White told an industry audience that the regulator is not comfortable with what it feels is lack of disclosure between private equity funds that specialize in real estate and the deals they may or may not be closing with their business partners that have an impact on investors in these funds.  Therefore, extra scrutiny will be paid. Oh and by the way, the SEC is also planning to put in place some kind of stress testing for advisers, although what the shape of that test will be is still to be determined. Comments and suggestions are welcome.

White’s comments come on the heels of what is turning into a fraught year for private equity funds and their relationships with regulators. There has been the steady push from state pension funds to reveal more about their carried interest fees. In addition, the SEC has collected and just published anonymized data from what used to be confidential filings of private equity funds — namely Forms ADV and Forms PF.