BlackRock has finalised the acquisition of ElmTree Funds, a St. Louis-based private equity real estate firm specialising in commercial net-lease and build-to-suit assets, primarily focused on industrial properties.

ElmTree will integrate into BlackRock’s Private Financing Solutions (PFS) platform, bolstering its ability to deliver long-term contractual income for investors while providing capital to support corporate infrastructure and growth strategies.

“Combining ElmTree’s expertise in the commercial net-lease sector with our leading capabilities and scale further augments our ability to provide diverse investment solutions for our clients as we continue to capture the immense opportunities created by structural shifts in the capital markets,” said Scott Kapnick, Chairman of the PFS Executive Office.

ElmTree founder James Koman will continue to lead its investment strategies as part of BlackRock’s platform.

Legal counsel to BlackRock and HPS was provided by Skadden, Fried Frank, and Sidley Austin, with Goldman Sachs serving as financial advisor to HPS. ElmTree was advised by Berkshire Global Advisors and Kirkland & Ellis.

Founded in 2011, ElmTree has developed a portfolio of net-leased properties in U.S. primary and secondary markets, leased long-term to investment-grade tenants. The deal highlights BlackRock’s continued expansion in alternative investments, particularly in private financing and real estate.

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