Locust Point Capital just closed its second fund focused on direct lending in the seniors housing and care sector. Locust Point Seniors Housing Debt Fund II, L.P. closed above its target at $428 million, receiving strong interest from a combination of pension funds, endowments, foundations, insurance companies and wealth advisors. Three quarters of the commitments came from United States-based investors, while European investors provided the balance.
The fund well exceeds Locust Point’s first, which launched in 2016 with a $312 million debut total, but the strategies will be roughly the same. Fund II will provide subordinate debt, preferred equity and opportunistic senior mortgage loans to owner/operators of seniors housing and care properties. With that capital in hand, those owners can then acquire, develop, expand or renovate their properties in a short-term, non-dilutive and flexible way.
Since Fund I’s inception in 2016, the total value of financed transactions in which Locust Point has participated exceeds $2.25 billion. Hopefully that strength can help play a role in reinvigorating the senior care M&A market, as it clearly is validation of investor interest in the industry. Opportunities will certainly abound in the next several years.
