$3.2 Billion NorthStar Capital Funds Declared Effective by SEC

NorthStar Real Estate Capital Income Fund and NorthStar Real Estate Capital Income Fund­T, two non-traded closed-end funds sponsored by NorthStar Asset Management Group (NYSE: NSAM), have been declared effective by the SEC. The funds’ initial public offerings seek to raise a total of $3.2 billion from the sale of common stock.

NorthStar Real Estate Capital Income Fund is a $3 billion offering with three share classes: class A shares, class D shares and class I shares. There is a minimum initial investment of $4,000 for class A and class D shares and a minimum initial investment of $100,000 for class I shares. Additional purchases must be in increments of $500, except for purchases made through the distribution reinvestment plan.

Class A shares are priced at $9.88 each with a 6 percent sales commission and a 2 percent dealer manager fee. Class D shares are priced at $9.28 and have no sales commission and a 2 percent dealer manager fee. Class I shares are priced at $9.09 and have no sales commission or dealer-manager fees.

There will also be organization and offering expenses of 1 percent of the total proceeds raised, after the payment of selling commissions and dealer manager fees.

NorthStar Real Estate Capital Income Fund-T is a $189.4 million continuous offering. The T-fund shares are priced at $9.47 with a 2 percent sales commission and a 2 percent dealer manager fee. Beginning the first month after the close of the offering, the shares will be subject to a distribution and servicing fee at an annualized rate of 1 percent of the NAV per share.

The two funds will seed and invest through NorthStar Capital Income Master Fund, an unlisted, closed-end fund registered under the Investment Company Act of 1940.

In March, The DI Wire reported that NorthStar launched two similarly structured $3.2 billion closed-end funds, the NorthStar Corporate Income Fund and NorthStar Corporate Income Fund-T.

The NorthStar Real Estate Capital Income Master Fund will primarily invest in commercial real estate debt, direct investments in commercial real estate properties, indirect investments through private equity funds and joint ventures, as well as investments in commercial real estate securities. NorthStar Securities is the dealer manager for the NorthStar Capital Funds.

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