This past November, private equity giant KKR capitalized KREF, at that time a non-traded mortgage REIT, closing on a private placement that gave it a total of $838 million of equity capital available, along with $1 billion of existing borrowing capacity across its lending facilities. KREF represents the first investment vehicle of KKR's Real Estate Credit business, which was launched in 2015 and is co-headed by Chris Lee and Matt Salem. “In addition to the evolving regulatory landscape, our existing relationship with borrowers, intermediaries and financing providers allows us to compete effectively for transactions and deliver attractive risk-adjusted returns to KKR and our investors,” Salem said in November.

Earlier this week, another mortgage REIT launched a global leader in alternative asset management, Blackstone Mortgage Trust, launched a joint venture for bridge lending in the multifamily sector, a market that could be worth as much as $20 billion. The venture will offer floating-rate first mortgage loans to borrowers.

NEW YORK CITY—KKR's mortgage REIT vehicle launched its initial public offering Wednesday with the sale of 10 million shares priced in the range of $20.50 to $2.150. The $210-million IPO target for KKR Real Estate Finance Trust (KREF) was more than double the $100-million goal identified in an SEC filing earlier this month.

The REIT's common stock has been approved for listing, subject to official notice of issuance, on the New York Stock Exchange under the KREF ticker. Wells Fargo Securities, Morgan Stanley and KKR are acting as joint book-running managers for the offering, while Barclays, Goldman Sachs and J.P. Morgan are acting as additional book-running managers. Keefe, Bruyette & Woods is acting as a co-manager.

KREF expects to grant the underwriters a 30-day option to purchase up to an additional 1.5 million shares of its common stock at the IPO. It will use proceeds from the offering to acquire senior loans secured by commercial real estate.

“We believe there is strong demand for CRE debt capital driven by a high volume of over-leveraged, near-term loan maturities, strong transaction volume fueled by improved economic conditions and CRE fundamentals and continued global capital inflows for CRE investment in the United States,” according to KREF's S-11 filing Wednesday. “In addition, constrained supply of CRE debt capital driven in large part by more restrictive underwriting standards from conventional financing sources compounded by increasing regulatory pressures have created a potential opportunity for alternative lenders like us to serve as attractive debt capital solutions providers to the real estate market.”

This past November, private equity giant KKR capitalized KREF, at that time a non-traded mortgage REIT, closing on a private placement that gave it a total of $838 million of equity capital available, along with $1 billion of existing borrowing capacity across its lending facilities. KREF represents the first investment vehicle of KKR's Real Estate Credit business, which was launched in 2015 and is co-headed by Chris Lee and Matt Salem. “In addition to the evolving regulatory landscape, our existing relationship with borrowers, intermediaries and financing providers allows us to compete effectively for transactions and deliver attractive risk-adjusted returns to KKR and our investors,” Salem said in November.

Earlier this week, another mortgage REIT launched a global leader in alternative asset management, Blackstone Mortgage Trust, launched a joint venture for bridge lending in the multifamily sector, a market that could be worth as much as $20 billion. The venture will offer floating-rate first mortgage loans to borrowers.