S3 Raises $1.3B of Capital with Third Credit Fund

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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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 16-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 7-10 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

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