Marc Lasry’s New York-based, distressed-focused hedge fund firm, Avenue Capital Group, recently raised $500 million for two new funds.

Avenue Europe Private Opportunities Fund, L.P. and Avenue Europe Private Opportunities Co-Investment Fund, L.P. , which recently closed their offerings, are focused on a combination of direct lending and private equity deals in Europe. The $500 million that Lasry recently raised for the new funds is especially impressive in this environment. Since the 2008 market selloff, large fund raisings among hedge fund managers have been almost non-existent. In July 2012, Avenue’s Avenue Europe Special Situations Fund II closed on $2.78 billion.

Lasry’s new funds also underscore his confidence in the turnaround of the economies in Europe. The Avenue Europe Strategy is led by Senior Portfolio Manager Richard Furst, who is also Chief Investment Officer of Avenue Capital Group.

Lasry launched his New York firm in 1995 with his lawyer sister Sonia Gardner, specializing in distressed and bankrupt securities Avenue is among a handful of firms with this strategy to somewhat blur the line between hedge funds and private equity, offering several longer-lock-up funds.  The firm had approximately $12.4 billion of assets under management as of June 6, 2013.

At the end of March, when Avenue managed $11.5 billion, about $5.1 billion was invested in its U.S. strategy, which invests in companies in financial distress, bankruptcy, undergoing a reorganization or liquidation or that are undervalued due to some sort of extraordinary event. Another $3.7 billion was similarly invested in Europe. Last year, Avenue International was up 10 percent, while Avenue Investments was up 15 percent.

Earlier this year President Barack Obama tapped the Moroccan-born Lasry to be the ambassador to France. However, Lasry — who was very excited to be moving to Paris and had hoped to be joined by his college-age children studying abroad — subsequently removed his name from consideration. According to reports, one sticking point was how Lasry would be able to be disengaged from Avenue but not be forced to sell his stake in the firm.