Private construction lender S3 Capital announced the final close of S3 LB RE Credit Fund III, with $850 million of discretionary fund commitments and an additional $465 million of co-investment commitments. The fund closed at its hard cap, exceeding its initial $650-million target. The fundraise brings total investable capital to approximately $1.3 billion and supports expected loan origination capacity of approximately $4.3 billion.
S3 LB RE Credit Fund III is a six-year closed-end fund focused on first lien construction lending, primarily financing multifamily residential developments in supply-constrained markets. The company said the fund was raised against the backdrop of a persistent U.S. housing shortage and continued retrenchment by regional banks from construction lending, creating an attractive opportunity for specialized private lenders.
“The opportunity in construction lending today is driven by a clear imbalance between the need for new housing supply and the availability of capital to finance it,” said Robert Schwartz, S3 co-founder and principal. “While the housing shortage is well understood, bringing new supply online requires lenders with the experience, discipline, and infrastructure to execute through the full lifecycle of a project.”
Pictured: Continuum Waterfront in North Bay Village, FL; S3 provided a $261-miilion construction loan last month.
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