King Street announces final close of second European real estate fund

Global investment firm King Street has successfully closed its European Real Estate Special Situations Fund II (ESS II), achieving approximately $950 mln (€804.6 mln) in capital commitments within a year. 

Brian Higgins, founder and managing partner of King Street

The fund was oversubscribed, demonstrating strong investor interest.
ESS II targets real estate opportunities where traditional financing is scarce, aiming to acquire institutional-grade assets at attractive prices. The fund will invest in core Western European markets, focusing on high-quality properties that are temporarily undervalued due to market illiquidity rather than fundamental issues.
Leveraging King Street's expertise across the capital structure, ESS II offers flexible capital solutions tailored to borrower needs, emphasizing value creation through capital structure adjustments, repositioning, and active asset management.
ESS II attracted a diverse global investor base from North America, Europe, Asia, and the Middle East. A significant 50% of commitments came from repeat investors, including those from the predecessor ESS fund and existing King Street real estate investors.
Brian Higgins, founder and managing partner of King Street, said: "The strong investor demand for ESS II reflects confidence in King Street's ability to deliver innovative financing solutions in a market where transparency and liquidity remain scarce. Amid historic dislocation, we see a clear path to recovery and believe ESS II is well-positioned to capitalize on a generational opportunity in European real estate."
Paul Brennan, partner and co-head of Real Estate responsible for leading the European business at King Street, added: "Our strategy focuses on the intersection of quality and complexity, providing capital solutions for trophy assets trading below intrinsic value due to market stress. As traditional lenders pull back and capital remains scarce, we're able to deploy flexible capital and access landmark assets through proprietary, off-market channels."
The successful closing of ESS II signifies a major step in the expansion of King Street's real estate investment platform. King Street's recent investments include the Four Seasons Rome, the Bauer Hotel Venice, Room00, Arlington House St. James, and Bravo! Students.