King Street Capital Management (KSCM) is an investment advisory firm that supports pooled investment vehicles. It does not advise individuals. If you are an investor looking for a financial advisor, SmartAsset’s five-minute matching tool can help you find suitable advisors in your area.
King Street Capital Management Background
KSCM first began operations in 1995. The firm’s general partner is King Street Capital Management GP, L.L.C. Today, it currently has more than $26 billion in assets under management (AUM).
The firm offers investment advisory services to its Flagship Funds and European Funds, Real Estate Funds and the Rockford Tower CLOs. Collectively, these funds invest in various asset classes that provide global exposure.
What Types of Clients Does King Street Capital Management Accept?
KSMC currently offers services solely to private investment funds. However, it may provide additional services to other client types in the future.
King Street Capital Management Minimum Account Size
Because the firm doesn’t serve individual clients, an account minimum is not applicable.
Services Offered by King Street Capital Management
KSCM delivers advice to private investment funds. Each has its own characteristics which we describe below:
- King Street Capital - available primarily to U.S. taxable investors
- King Street Capital, Ltd. - available primarily to non-U.S. investors and U.S. tax-exempt investors.
- King Street Europe, L.P and King Street Europe, Ltd. - feeder fund that invests most assets through master fund King Street Europe Master Fund, Ltd., a British Virgin Islands business company.
- King Street Real Estate Fund, L.P - available primarily to U.S. taxable investors
- King Street Real Estate Fund (Offshore PF), L.P., - a Cayman Islands exempted partnership offered primarily to non-U.S. investors and U.S. tax-exempt investors
- Rockford Tower CLOs: collateralized loan obligation vehicles that invest primarily in broadly syndicated loans
King Street Capital Management Investment Philosophy
KSCM services funds that invest in a variety of asset classes. Each fund has its own objective. The Flagship Funds invest globally across different asset classes such as equities and fixed income and are event-driven. As their name implies, the European Funds invest in a variety of European assets. Similarly, the Real Estate Funds invest in global real estate and real estate-related assets, focusing, the firm says, “on situations that are out-of-favor, complex, misunderstood or in markets undergoing a transition.”
Fees Under King Street Capital Management
Fees for KSCM’s investment advisory services are typically charged as a percentage of assets under management (AUM). That percentage varies, depending on the fund.
For the Offshore Funds, clients have a choice between the Tranche I or II or Structure I or II fee schedule. Annual Management fees for Tranche I/Structure I investors are 1.5% of net assets and payable in advance on a quarterly basis. The management fees for Tranche II/Structure II investors are 1.0% of net assets of the applicable fund, payable in advance on a quarterly basis.
Additionally, the firm receives performance-based fees of 20% of net profits (including realized and unrealized gains) of the applicable fund for Tranche I/Structure I, and 25% of the net profits (including realized and unrealized gains) of the applicable Fund for Tranche II/Structure II.
The Real Estate Funds generally pay KSCM or an affiliate a 1.5% management fee quarterly in advance. An affiliate of KSCM, says the firm, “will receive a carried interest with respect to the Real Estate Funds generally equal to 20% of all realized profits subject to a preferred return of 8% per annum compounded annually, as more fully described in the governing documents of each Real Estate Fund.”
Rockford Tower Capital Management (RTCM) receives management fees from the Rockford Tower CLOs at about 0.45% of the par value of the collateral and cash held in the Rockford Tower CLOs. Performance-based fees are “typically 20% of the excess cash flows due to the holders of the subordinated notes, subject to a stated hurdle rate,” according to the firm.
What to Watch Out For
KSCM does not offer financial planning or serve individual investors with small asset sizes. If you are looking for a financial advisor to customize your portfolio or help you with your personal finances, this firm is probably not the right fit.
Opening an Account With King Street Capital Management
To contact KSCM, send an email via its website at https://www.kingstreet.com/ContactUs.aspx?Id=Non.
Where Is King Street Capital Management Located?
KSCM is headquartered at 299 Park Avenue, 40th Floor, New York, New York 10171.
It also maintains offices in London, Singapore, Tokyo and Charlottesville, Virginia.
Tips for Finding the Right Financial Advisor
- There are plenty of financial advisors who work with individual clients. To find one near you, use SmartAsset’s pro matching tool. It links you with up to three advisors in your area.
- Don’t assume all financial advisors will provide advice in your best interests. Some are only required to provide “suitable” recommendations. So ask prospective advisors if they are fiduciaries. If they aren’t, you may want to keep on looking.
All information was accurate as of the writing of this article.