Fairbridge winds down two funds after real estate losses and withdrawals

Crain’s New York Business reported Nov. 10 that Fairbridge Asset Management is closing two private credit funds after investor withdrawal requests and real estate losses. The report also says James McManus was contacted by SEC attorneys as scrutiny of the firm and the broader private credit sector grows.

Why it matters: - Fairbridge Asset Management’s planned fund wind-down adds pressure to the private credit market after losses, withdrawal requests, and questions about oversight. - The episode underscores investor risk in private credit funds tied to real estate, where losses can quickly affect withdrawals and liquidity. - The report also highlights broader concern about how private credit firms manage risk and what regulators may be reviewing.

What happened: - Crain’s New York Business published a Nov. 10 report saying Fairbridge plans to close Fairbridge Partners LP and Fairbridge Partners Cayman LP. - Investors sought to withdraw nearly 25% of the funds’ roughly $400 million in assets. - The funds declined about 4% in September. - Fairbridge recorded $11 million in writedowns and about $7 million in additional losses. - The report says James McManus received an email from two Securities and Exchange Commission attorneys inviting him to discuss information concerning Fairbridge. - The SEC declined to comment.

The details: - McManus is a New York and Connecticut-based real estate developer, fraud expert, and founder of the Center for Private Credit Accountability. - CPCA is a nonprofit focused on transparency, ethical lending, and borrower and investor protection. - McManus says CPCA is meant to protect Americans’ hard-earned money and promote accountability in private credit. - McManus said he appreciated Crain’s continued coverage of the story and praised reporter Aaron Elstein for explaining why the issues matter to borrowers and investors. - Crain’s article is titled "Private Credit Firm Accused of Acting Like the Mob Winding Down Funds After Real Estate Losses." Read the article

Between the lines: - McManus is using the attention around Fairbridge to push for tougher rules in private credit. - He says the industry lacks clear, enforceable standards for lenders, their associates, and the institutions that finance them. - He argues that weak safeguards can leave investors facing losses and borrowers at risk of losing properties and development projects. - McManus is also calling for stronger judicial safeguards and financial oversight. - The SEC outreach suggests the issue may be drawing regulatory interest, even though the agency has not publicly commented.

What’s next: - McManus says CPCA will keep pressing lawmakers, public officials, and financial experts to create clearer rules for private credit lending. - He says he will continue advocating for people in the U.S. and abroad who report being defrauded in private credit transactions. - McManus says investors in Canada and the United Kingdom have contacted CPCA and his attorney, Andrew Laufer, for help and stronger legal oversight. - McManus is also urging the U.S. Department of Justice to investigate possible wrongdoing involving private credit companies and their partners. - He says stronger safeguards are needed to protect vulnerable investors and pension beneficiaries and to reduce the risk of broader financial harm.

The bottom line: - Fairbridge’s fund shutdown is a warning sign for private credit investors, while McManus is using the moment to argue for more transparency, oversight, and enforcement.