European vs American Waterfall
The structural choice between FUND-LEVEL (European) and DEAL-BY-DEAL (American) distribution waterfalls in a PE fund. European waterfalls defer all GP carry until LP preferred return is met across the FULL fund, eliminating clawback complexity but pushing GP cash flow several years later. American waterfalls let GPs collect carry on each realized deal independently, generating earlier GP cash flow but requiring clawback provisions to prevent overpaid carry on outperforming deals being offset by losing deals. The 2010-2020 trend has been toward European-with-clawback as the LP-friendly institutional standard.
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Absorption Rate · AFFO per Share · Allowed Return on Equity · Alternative Investments · Anchor Tenant · Assets Under Management
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