Pearlmark’s 6th Real Estate High Yield Credit Fund Eclipses $300M

Pearlmark held the second closing of its sixth high yield credit investment fund, Pearlmark Mezzanine Realty Partners VI, L.P., which now has more than $300 million in commitments, including discretionary managed accounts. The capital expands on the initial closing of more than $185 million in August 2024.

Loan sizes are expected to range from a minimum of $5 million to $50 million or greater in combination with co-investment capital on larger loan sizes. Pearlmark anticipates a final close to occur in the first quarter of 2025 and expects to eclipse its $400 million target.

Pearlmark Mezz VI focuses on subordinated debt investments in multifamily and other adjacent sectors, such as student housing, active senior and build-for-rent communities, as well as industrial/logistics sectors. The firm will also consider investing in mixed-use, medical office, and grocery-anchored retail assets.

Pearlmark said the firm’s predecessor fund is almost fully committed with 25 high-yield credit investments, with one final investment pending. Three investments are likely to close before the end of the year.

“There continues to be strong appetite from institutional capital for attractive risk-return in our middle-market mezzanine market, and significant demand from sponsor/borrowers for the structured gap finance products Pearlmark offers,” said Doug Lyons, managing principal and head of debt investments.

Chicago-based Pearlmark targets domestic core-plus to value-add real estate opportunities via commingled funds, separate accounts, and joint venture structures. The firm has originated more than $2.1 billion across 162 high-yield debt and preferred equity investments over two decades.