Yes Virginia, There Were LP Defaults in 2009
Remember all that talk about limited partner defaults, whereby private equity firms would make capital calls that their illiquid investors couldn't cover? And then how it didn't seem to happen? Well, perhaps news of no LP defaults was exaggerated. peHUB has learned that Granite Hall Partners, a Chicago-based fund-of-funds, defaulted on a $15 million commitment to TPG Capital in the middle of last year. The commitment was for TPG's sixth mega-buyout fund, and was made just before TPG plugged around $2 billion into Washington Mutual. At the time, Granite Hall was seeking to raise around $150 million for its third fund-of-funds. Its prior two vehicles had been capped at just over $60 million, with most of the money coming from high-net-worth individuals. The third fund-of-fund instead was designed to entice institutional investors, although the
