Morgan Stanley Real Estate Fund VII was closed at $4.7 billion, said spokeswoman Alison Barnes.
The fund’s original fundraising target was $10 billion, according to minutes for the June 27, 2008, board meeting of the Contra Costa County Employees’ Retirement Association, Concord, Calif., a former investor in the fund.
The fund has been closed to further commitments since last year but remained technically open to tie up loose ends, sources told Pensions & Investments last June.
According to sources close to the firm, Morgan Stanley offered each investor a structured capital commitment reduction prior to closing the fund in response to the financial markets dislocation beginning in late 2008, which resulted in many investors facing liquidity constraints, these sources said.
Last year, the $68 billion New Jersey State Investment Council, Trenton, and $1.6 billion Contra Costa County association withdrew their commitments. Current investors include the $43.2 billion Pennsylvania Public School Employees’ Retirement Board, Harrisburg.