First Eagle Launches Interval Fund Focused on Private, Public Credit Opportunities
First Eagle Investments has launched the First Eagle Real Estate Debt Fund, a closed-end interval fund which First Eagle is electing to have taxed as a real estate investment trust.
According to First Eagle, the fund seeks to provide attractive risk-adjusted returns and current income by investing across private and public real estate debt markets, with a focus on investment opportunities in residential real estate.
“We believe that long-term secular drivers such as demographic tailwinds, a persistent housing supply shortage and the ongoing need for financing present a strong, differentiated opportunity in the residential real estate market,” said Rajesh Agarwal, portfolio manager of First Eagle Real Estate Debt Fund. “Recognizing the regulatory headwinds facing conventional lenders that historically served this space, we see a durable opportunity for alternative credit firms like ourselves to provide much-needed capital to the residential real estate market and potentially generate attractive risk-adjusted returns and current income for our investors.”
The interval fund seeks to achieve its investment objective by investing in cash-flow generating, short-duration assets across residential and residential-related real estate lending markets – and in doing so, provide access to a range of private and public credit opportunities that are not typically available in retail-oriented investment products.
In terms of private credit opportunities, fund documentation alluded to the company investing in residential transitional loans, which are short-term loans made for the acquisition and renovation of residential properties, and land-banking transactions, which provide off-balance-sheet financing to reputable and creditworthy homebuilders to manage land inventory for new-home development.
On the public credit side, the fund in the near term will invest in various public structured credit securities backed by diverse pools of underlying mortgage loans, such as agency and non-agency mortgage-backed securities and credit-risk transfer securities.
“As investors increasingly look beyond traditional corporate direct lending, this fund offers access to the residential real estate debt market – a large and diverse segment of the asset-based lending space. For advisers seeking a source of current income for their clients, the Fund’s REIT tax status offers potential tax-advantaged income within an interval fund structure, making it a compelling and differentiated option. It also provides an opportunity to expand real estate exposure beyond the typical non-traded equity REITs and debt investments focused on commercial real estate,” said Frank Riccio, head of U.S. wealth solutions.
The fund is offering four share classes: Class A-2, Class A-3, Class A-4, and Class I shares.
The interval fund will offer quarterly repurchases from 5% to 25% of its outstanding common shares at net asset value.
The fund’s management fee, as a percent of net assets, is 1.68% for all share classes.
For Class A-2 Shares and Class A-4 Shares, an investor will pay a sales load of up to 2.56% on the amounts it invests. If an investor pays the maximum aggregate 2.56% for sales load, the company said it must experience a total return on net investment of 2.56% in order to recover these expenses.
The adviser has contractually undertaken to waive and/or reimburse certain fees and expenses of the fund so that the total annual operating expenses (excluding interest, taxes, brokerage commissions, acquired fund fees and expenses, dividend and interest expenses relating to short sales, and extraordinary expenses, if any) of the Class A-2, Class A-3, Class A-4 and Class I shareholders are limited to 1%, 1%, 0.75% and 0.25%, respectively, of average net assets. This undertaking lasts until April 30, 2026l and may not be terminated during its term without the consent of the board.
The fund has agreed to repay the adviser for fees and expenses waived or reimbursed for the class provided that repayment does not cause annual operating expenses (after the repayment is considered) to exceed either: (1) 1%, 1%, 0.75% and 0.25% of the class’s average net assets, respectively, or (2) if applicable, the then-current expense limitations.
The Real Estate Debt Fund is First Eagle’s third interval fund and the first managed by Napier Park Global Capital, which First Eagle acquired in 2022. It joins the First Eagle Tactical Municipal Opportunities Fund, which was launched earlier this month, and the First Eagle Credit Opportunities, which has approximately $921 million in total assets (as of March 31, 2025) since its 2020 launch.
“U.S. housing prices have remained elevated despite the rise in mortgage rates since the beginning of the Federal Reserve’s rate-hike cycle. We believe this strength in housing reflects a structural shift in the market that began with the global financial crisis and was exacerbated by the dislocations of Covid-19, which contributed to a long-term, secular shortage of available housing. We also believe it created a lasting investment opportunity in residential real estate credit for nimble, experienced capital providers like Napier Park,” said Jon Dorfman, managing principal and chief investment officer of Napier Park.
Leveraging the scale and infrastructure of the Napier Park credit platform as well as its extensive experience, the fund’s investment team intends to actively manage its portfolio through dynamic reallocation among private and public credit investments through multiple market cycles.
Last month, AltsWire reported that the advisers for First Eagle’s business development company, First Eagle Private Credit Fund, waived a portion of management fees and sub-advisory fees for the period from July 1, 2025, through Dec. 31, 2025. Specifically, they amended the fund’s management fee waiver from 100% through June 30 to now also include a 50% waiver from July 1 to the last day of the year. The company also extended its incentive fee waiver from 100% waived through June 30 to 100% waived through Dec. 31.
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