Hamilton Lane closes secondaries fund on $1.9bn

Greg Gille
08 June 2017

Tweet
Facebook
LinkedIn
Google plus
Send to

Hamilton Lane's Secondary Fund IV has reached a final close on $1.9bn.

The firm stated that it was originally targeting $1.25bn, but investor demand pushed the vehicle past that to reach $1.9bn.

According to an LP advisory source, the fund has a three‐year commitment period and a lifespan of 10 years.

The vehicle is Hamilton Lane's largest secondaries vehicle to date. According to the LP advisory source, Hamilton Lane's first foray into secondaries in 2000 was its Pre‐Fund vehicle, which generated a net IRR of 13.2% with a net multiple of 1.5x. HL Secondary Fund I (closed on $360m), a 2005 vintage, generated a net IRR of 4.3% and a net multiple of 1.2x. The $590m HLSF II fund, a 2008 vintage, generated a net IRR of 15.1% and a net multiple of 1.5x. Finally the 2012-vintage HLSF III (closed on $909m) generated a net IRR of 18.6% and a multiple of 1.3x.

According to that same source, Hamilton Lane's weighted average IRR for secondary fund investments overall is 18%.

Hamilton Lane declined to confirm the information obtained via the LP advisory source.

The fundraise adds to a number of closes for sizeable secondaries vehicles in recent months. Since the start of 2017 alone, AlpInvest Partners has raised $6.5bn for its secondary investments programme, with $3.3bn going to its AlpInvest Secondaries Fund VI vehicle, while US-based firm Neuberger Berman held a final close for its latest global secondaries fund on $2.5bn, surpassing its $2bn target. Committed Advisors also held a final close for its third fund, Committed Advisors Secondary Fund III, on its hard-cap of €1.025bn.

Investors
Hamilton Lane stated that the fund attracted 110 global investors, including Taft-Hartley pension plans, corporate and public pension funds, sovereign wealth funds, family offices, endowments, foundations and other financial institutions.

According to unquote" research, US-based LPs in the fund include Fresno County Employees' Retirement Association, Employees' Retirement Fund of the City of Dallas and Public Employee Retirement System of Idaho.

According to the LP advisory source, Hamilton Lane committed 1% to the fund.

Click here to access the full fund profile for Hamilton Lane Secondary Fund IV on unquote" data, including a comprehensive list of LPs

Investments
Fund IV aims to provide investors with a balanced portfolio by diversifying across single funds, subset portfolios and complex structured and direct investments, according to Hamilton Lane.

The firm is aiming to source its transactions off-market through its own network. As of March this year, the fund was understood to have already invested $357m in either closed or pending commitments across 11 transactions.

People
Hamilton Lane – Tom Kerr (managing director, global head of secondaries).