Federated Hermes acquires stake in Penny Blue Capital’s European real estate debt fund

Federated Hermes has acquired ESR’s interest in Penny Blue Capital’s flagship European real estate debt fund, marking a significant milestone for Penny Blue following its recent separation from ESR Europe and transition to a fully independent, management‑owned platform.

Beatrice Dupont and Paul House, Penny Blue

Founded by Beatrice Dupont and Paul House, Penny Blue has originated more than €5 billion of loans across Europe and built a track record through multiple market cycles. The firm specialises in senior loans secured against high‑quality real assets, with a disciplined underwriting approach focused on capital preservation and attractive risk‑adjusted returns for institutional investors.

The acquisition strengthens Penny Blue’s institutional investor base and follows the firm’s relaunch as an independent boutique manager combining entrepreneurial agility with the governance and investment discipline developed over more than a decade within ESR Europe.

Federated Hermes’ Private Credit business manages over $2 billion of assets and has operated a dedicated real estate debt strategy since 2015, targeting stable, uncorrelated returns from sustainable European real estate through conservative, asset focussed underwriting.

Beatrice Dupont, CEO of Penny Blue, said Federated Hermes’ investment is “a significant endorsement of the platform we have built,” adding that the market is increasingly favouring large managers, creating an opportunity for a boutique lender offering closer access to decision‑makers and strong alignment.

Vincent Nobel, Head of European Real Estate Debt at Federated Hermes, said the transaction, the firm’s first European real estate debt secondaries deal was driven by the “quality of the portfolio,” reflecting disciplined underwriting and attractive sector exposure.

Paul House, CIO of Penny Blue, said the investment comes after “one of the most significant real estate repricing cycles in recent history,” adding that the European real assets debt market continues to offer compelling opportunities for specialist lenders.