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PERE’s ranking of the 30 largest private equity real estate firms in the world
The PERE 30 measures equity raised between 1 January 2007 and mid-April 2012 for direct real estate investment through closed-ended, commingled real estate funds and co-investment vehicles that sit alongside those funds. The vehicles must give the GP discretion over the capital, meaning club funds, separate accounts and joint ventures are excluded from the ranking. Also excluded are funds with strategies other than value-added and opportunistic, such as core and core-plus, as well as those not focused on direct real estate, like fund of funds and debt funds, and funds where the primary strategy is not real estatefocused, such as general private equity.
other firms like Fortress Investment Group. Morgan Stanley. while returning firms include AEW Global.21 billion this year. some firms did find success with new funds over the past five quarters.265 billion. The positions of a few firms also were affected by decisions to return uninvested capital to investors. which is hanging in on the strength of its $2. although there have been some shifts in their order and fundraising totals. Goldman Sachs jumped from fifth to third place on the back of flexible capital that was invested opportunistically. CIM Group and Northwood Investors. The top five firms in the ranking – The Blackstone Group.PERE 30 Spring cleaning Most of the legacy platforms from before the global financial crisis are now gone. The only remnant of such firms still in the PERE 30 ranking is Bank of America Merrill Lynch. The exit of these legacy platforms from the PERE 30 has opened the door for several new players to emerge in this year’s ranking and a few other firms to make a reappearance following an absence of a couple of years. A number of legacy platforms that were hurt by the global financial crisis and subsequently acquired or wound down – including Lehman Brothers. KSL Capital Partners.65 billion Asian Real Estate Opportunities Fund that closed in 2008. Looking at the PERE 30 as a whole.7 billion Morgan Stanley Real Estate Fund VII Global in exchange for a 12-month extension of its investment period. Meanwhile. While the lower threshold allowed for Brookfield. Despite all those changes. making room for new players and the return of others in this year’s ranking The spring cleaning mantra of ‘Out with the old. . thanks to successful final closings last year. thanks to the $10 billion and counting raised for its latest fund. Citi Property Investors and KK daVinci Advisors –are no longer present. some if not all of these firms could make it in the next year or so. Lone Star Funds and The Carlyle Group also experienced incremental bumps in the ranking. Despite the tough environment for fundraising. Blackstone cemented its place as far and away the biggest capital-raiser in the PERE 30.48 billion last year to $2. moved up nine spots on the strength of $1. Meanwhile. Patron Capital and ARA Asset Management were $200 million or less from making the PERE 30 list. Goldman Sachs.4 billion in equity raised so far. the cutoff for capital raised in order to make this year’s ranking declined from $2.4 billion Asia Opportunity Fund III. DRA and JER to make this year’s cut. in with the new’ very much describes this year’s PERE 30 ranking. JER Partners and DRA Advisors. Starwood Capital Group. As the remaining funds from before the global financial crisis fall outside the ranking’s five-year window. For example. Morgan Stanley Real Estate Investing returned $700 million from its $4. particularly in the second half of the year. Angelo Gordon & Co closed its latest opportunity fund on $1. The first-time members of the PERE 30 are Brookfield Asset Management. which propelled the firm some 11 spots in the ranking. Two of the biggest fundraisers over the past five quarters also happen to be the two biggest climbers in the PERE 30. there was some stability at the top of the PERE 30. For example. thanks to the elimination of large 2006 vintage funds that now fall outside the ranking’s five-year fundraising window. which is in the middle of marketing its latest fund. LaSalle Investment Management returned $600 million in uninvested capital rather than seek an extension for its $2. Tishman Speyer and Colony Capital – remain the same as last year.
426 $4.580 $6.567 $3.595 $4.124 $12.667 $12. Gordon & Co Rockpoint Group Shorenstein Properties Bank of America Merrill Lynch Global Principal Investments AEW Global Hines Brookfield Asset Management Lubert-Adler Partners JER Partners Grove International Partners CIM Group Northwood Investors DRA Advisors Walton Street Capital tOtal EqUity raiSEd SinCE 2007 Legend: Higher rank than 2011 Lower rank than 2011 PERE 30 return .683 $3.212 $178.963 $3.396 Same rank as 2011 PERE 30 debut 2011 rank 1 2 5 3 4 8 10 6 11 7 13 21 15 12 9 23 28 17 16 22 — 29 — 18 — 30 — — — 20 Prudential Real Estate Investors TA Associates Realty Angelo.464 $2.654 $9.900 $6.104 $11.867 $2.639 $7.025 $5.2012 rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 name of Firm The Blackstone Group Morgan Stanley Real Estate Investing Goldman Sachs Real Estate Principal Investment Area Tishman Speyer Colony Capital The Carlyle Group Lone Star Funds Beacon Capital Partners Westbrook Partners LaSalle Investment Management MGPA Starwood Capital Group CBRE Global Investors AREA Property Partners Capital raised ($bn) $29.310 $2.959 $3.864 $5.728 $2.035 $3.261 $2.371 $2.604 $2.782 $3.250 $2.496 $2.295 $3.100 $12.871 $2.
Other LPs. Headquarters: New York Founded: 1991 No of real estate professionals: 280 When Morgan Stanley Real Estate Investing (MSREI) was granted a 12-month extension on the investment period for its latest global opportunity fund. Meanwhile.995 billion vehicle raised in 2008. which this time will include Europe alongside the US in its investment thesis. MSREI would need to demonstrate decent performance for MSREF VII Global.6 billion in 2008.1 million acquisition of 36 US shopping centers from Equity One. in January. is positioning itself more firmly in the real estate debt space.1 million-square-foot suburban office portfolio in the US from Duke Realty for $1.7 billion in capital commitments be cancelled. BREP VII could be the largest closed-ended real estate fund ever. As previously reported. MSREI can still say it has raised the secondmost amount of equity for private equity real estate investing over the past five years. BREP VII focuses primarily on opportunistic real estate opportunities in the US and Canada. certain corners of the market compared it to a fresh equity commitment. for that to happen. 3 Goldman Sachs Real Estate Principal Investment Area $12. the majority of this capital was deployed opportunistically and thus becomes relevant for this ranking. including the Teachers’ Retirement System of the State of Illinois and the State of Wisconsin Investment Board.08 billion.1 billion 2 Morgan Stanley Real Estate Investing $12. MSREF V. which closed on $10. the capital raised for MSREI’s 2006 vintage fund. PERE sources say the fund’s performance is looking strong. Last month.9 billion in 2008. Of course.124 billion Headquarters: New York Founded: 1991 Total equity raised since inception: $29 billion In a strange quirk. the Canada Pension Plan Investment Board and the China Investment Corporation. the firm is slated to hit the market later this year with a mission to haul in approximately $3 billion for the sequel vehicle. and the acquisition of a portfolio of real estate debt and equity interests from Bank of America Merrill Lynch. none of that capital is eligible for the firm’s PERE 30 ranking total. a real estate debt fund that corralled $2. Whether REPIA can maintain this lofty position is another matter. In return for a year extra. the fund already had invested 10 percent of the capital it had raised in transactions that include the $473. Goldman Sachs’ Real Estate Principal Investment Area (REPIA) finds itself back in third place – having last occupied the slot in 2009 – despite having not closed on any additional capital. the firm Garman: focusing chose wisely when investing the capital of its US Real Estate more on debt Opportunities fund. particularly when considering how the platform. a $1. The reason? Put simply. including the Government of Singapore Investment Corporation. 42 PERE | MAY 2012 . By the time the fund holds its final close.5 million-square-foot portfolio of UK industrial properties from Prologis. Unfortunately. however. the purchase of a 10. MSREI’s investors. and the show of support from its investors would seem to underscore that. Success there could help to bolster MSREI’s fundraising total next year. led by Alan Kava in New York and James Garman in London.667 billion Headquarters: New York Founded: 1992 Real estate assets under management: $49 billion With The Blackstone Group having raised $10 billion for its latest global opportunity fund. the $335 million purchase of a 3. Indeed. These factors combined mean that MSREI’s total is some $3 billion lower than last year. PERE revealed REPIA’s plans for a follow-up to its GS Real Estate Mezzanine Partners fund. Unfortunately for the investment bank-sponsored platform. eclipsing the firm’s previous global effort. Indeed. came onboard later. required that $700 million of the remaining $2. boosting the amount of capital to $6 billion by year’s end. Blackstone officially launched BREP VII in April 2011 and held a first close on $4 billion in equity just four months later. and various single-asset funds that had the scope to invest in both core and opportunistic strategies. On a positive note. By the end of February. being a debt fund. the New York-based private equity and real estate giant has puts a vast amount of space between it and the next closest firm in the PERE 30 ranking. Blackstone Real Estate Partners (BREP) VII. Morgan Stanley Real Estate Fund (MSREF) VII Global. and its affiliated co-investment side-buckets no longer qualify for inclusion. Plans for a new $1 billion US-focused opportunity fund have been reported too – part of a move to introduce more regionally-focused investment vehicles to its programme. attracting capital from investors such as the New Jersey Division of Investment and the Pennsylvania Public School Employees’ Retirement System. it is now appears more difficult than ever to see how Blackstone’s HQ: a any firm could usurp fundraising mecca Blackstone’s stranglehold on the top position. As it transpired. the net result was actually a reduction in terms of total capital raised over the past five years.PERE 30 1 The Blackstone Group $29.
3 billion European Real Estate Venture VI and the $1. Colony Realty Partners IV. adding that he believes “LPs increasingly are willing to consider opportunistic funds. managing director and head of Carlyle’s US real estate funds. Since then. has raised $350 million in commitments to date and is said to be on track to hold a final close this summer. Although the firm has suffered problems. the firm continues to rank high in the standings in part because of the significant amounts of capital it has raised through value-added and opportunistic funds. On the value-added and opportunistic front.5 billion US Fund VII. such as the $1. of course. having raised nearly $10 billion in equity for property investments since 2007. development-focused fund with a $500 million target. the firm also held a first close of $500 million for its US Fund VIII. Carlyle bolstered its real estate group in preparation for its impending IPO. buying Miramax Films in 2010 for $663 million in conjunction with Qatar’s sovereign wealth fund and ‘creative partner’ Rob Lowe. In fact. hotels. Washington DC and Boston.104 billion Headquarters: New York Founded: 1978 No. including New York. with some investments such as Station Casinos and Xanadu going sour. an opportunistic. The commingled vehicle is seeking to invest predomiStuckey: a good nantly in six prop. the dedicated funds that Colony recently has raised are much smaller than the big daddy of its investment vehicles. Although we do not count debt funds for the purposes of the PERE 30. In recent times. Barrack and Colony have continued to raise capital for distressed real estate situations through the crisis. San Francisco. but Real Capital Analytics has kept track of a few. In December. had attracted $2. for $41 million in April and the purchase of a 57. the firm appointed 11 real estate professionals to senior positions. the firm raised $885 million in 2008 for its Distressed Credit Fund and established and took public Colony Financial.” Additionally.” he said. he has even taken Colony into the entertainment business directly.34 billion in equity commitments. Colony has hardly lost its appetite for less glamorous real estate. of real estate professionals: 191 Los Angeles-based Colony Capital is the closest thing private equity real estate has to show business. Carlyle Realty Partners (CRP) VI. Tishman typically doesn’t discuss fund investments. In March. Still. which is targeting $750 million and will invest primarily in value-added real estate opportunities in major US cities. Tishman Speyer remains in the top five of the PERE 30 ranking. recent deals executed on behalf of Tishman’s funds include the acquisitions of Foundry Square III. And.000-square-foot building in Beverly Hills last September. of real estate professionals: 122 The Carlyle Group’s real estate division has been fairly active these past few years. Los Angeles. a $600 million mortgage REIT. According to the data provider. Tishman Speyer Brazil Fund III. including three to managing director and eight to principal/director.PERE 30 4 Tishman Speyer $12. exceeding its initial target of $2 billion. in 2009. With Carlyle looking to both go public and invest on behalf of its latest oversubscribed fund. it appears that the firm and its staff won’t be getting any rest in 2012 either.time to be investing erty types – offices. 5 Colony Capital $11. an office and retail redevelopment site in San Francisco. once again benefiting from Foundry Square III: the substantial amount of co-investment capital that it has Tishman’s latest vision collected over the past five years.654 billion Headquarters: Los Angeles Founded: 1991 No. with the Washington DC-based private equity firm closing its sixth US real estate fund and gearing up for its initial public offering. and Colony is said to be back on the road with its latest value-added fund. explained that the firm was looking to raise funds for CRP VI during the downturn so that it could invest during the upturn. there was the famous deal to provide Michael Jackson with a loan for his Neverland Ranch property in Santa Barbara County. the $4 billion Colony Investors VIII fund of 2007. Still. In an interview with PERE. Robert Stuckey. retail. multifamily. Adding to Tishman’s overall fundraising tally this year are more than $1 billion in closings for three regionally-focused vehicles currently in the market. Carlyle confirmed that its sixth opportunistic fund. 6 The Carlyle Group $9. Founder Tom Barrack was once on the cover of Fortune magazine under the strap Neverland Ranch: an eclectic investline ‘the world’s greatest real estate investor’. the capital raised through sidecars continues to surpass the amount of thirdparty equity raised for primary vehicles over the same period. and he continues ment opportunity to feature on Bloomberg TV and other business channels. the firm has raised two smaller opportunistic vehicles in Europe. senior living facilities and student housing – in major markets in the US. In January. MAY 2012 | PERE 43 . of real estate professionals: More than 640 Down a spot from last year.639 billion Headquarters: Washington DC Founded: 1987 No. Last year in particular was quite busy. “We believe it’s a good time to be investing.
44 10 LaSalle Investment Management $5. it beat rivals to a £900 million loan book (then €1.864 billion Headquarters: Chicago Founded: 1980 Assets under management: $47. signs It was revealed in November Kazilionis: nodown of slowing that Westbrook began seeking $2 billion for Westbrook Real Estate Partners IX. In its most high-profile deal of 2011. Fund VIII still has roughly $1 billion of equity to deploy before its investment period ends this September.4 billion of the total amount raised is still counted for the purposes of the PERE 30. made on behalf of its latest fund. so just $2. However. led by global chief executive officer Jeff Jacobson. Ultimately. the New York-based private equity real estate firm is still going as strong as ever. told a PERE-hosted panel at the recent MIPIM conference: “Today. of real estate professionals: 70 Slipping two spots to eighth place. which enjoyed commitments of nearly $1 billion by the time of its close in 2007. It also raised a Japan logistics fund. we see a lot. Last summer. Beacon beat out 12 other real estate firms to become the winning bidder for Charter Hall Office REIT’s 14-property portfolio in the US. LaSalle currently is raising its next round of valueadded and opportunistic vehicles in the US.9 billion 8 Beacon Capital Partners $6. that substantial fundraising. Prior to the official start of its marketing effort. London. Washington DC. Fund IX won’t begin buying properties until its predecessor is fully invested. Westbrook’s prior real estate vehicle. Fund IX received a total of $200 million in commitments – 10 percent of the fund’s target – from the endowments of Harvard University and Massachusetts Institute of Technology in a bid to kick-start the fundraising process. helps to keep the Bostona trophy asset via Charter Hall based firm in the top 10 of the PERE 30 ranking. but the fund collectively managed to attract $5. It is a strategy that has allowed the growth Chicago-based firm. LaSalle Japan Logistics Fund II. San Francisco. Lone Star’s recent exploits have received lots of attention.580 billion Headquarters: Boston Founded: 1998 No.025 billion Headquarters: New York Founded: 1994 Currently raising: Westbrook Real Estate Fund IX Losing managing principal Avi Banyasz in early 2011 hasn’t seemed to slow down Westbrook Partners. Shortly afterwards. closed on $2. Paris and Tokyo. Asia and Europe.3 billion As a global outfit with a huge staff of 595 real estate professionals. Fund VIII.3 billion in commitments in May 2008. along with a $4 billion predecessor that closed Wells Fargo Center: in 2007.71 billion in August. the firm won an auction for a US non. and the acquisition. In fact. the Dallas firm fell short of reaching its original $10 billion target for the vehicle. LaSalle Investment Management offers a wide array of funds and separate accounts with differing strategies and risk Jacobson: advocating global profiles. Beacon instead has concentrated on putting significant amounts of capital to work. 7 Lone Star Funds $7.1 billion. Lone Star Real Estate Fund II.5 billion – more than any other single private equity real estate fund in 2011 with the exception of The Blackstone Group. closed in March. 9 Westbrook Partners $6. Beacon Capital Partners hasn’t raised any new capital since Beacon Capital Strategic Partners VI. the firm raised a massive $3 billion for LaSalle Asia Opportunity Fund III – the second largest Asia opportunistic real estate fund ever to be raised.” Lone Star’s investors believe the firm and. PERE | MAY 2012 . $1. As a result. It subsequently handed back $600 million of commitments. have backed it up with capital. Los Angeles. The firm signed an agreement to purchase the assets for $1. to emerge from the financial crisis in relatively good shape. more importantly. rising to tenth place after raising the lion’s share of its second dedicated real estate opportunity fund. its managing director in Europe. The main reason LaSalle is among the top 10 firm in the PERE 30 has largely to do with its fundraising efforts focused on Asia real estate. Although it tries to operate as under the radar as possible. Los Angeles and New York. As one might expect from a firm from with a huge LP base and a global footprint. focusing on valueadded office investments in markets such as Boston.4 billion) from semi-nationalised UK bank Lloyds Banking Group.and sub-performing loan book with a face value of more than $5 billion offloaded by stricken Anglo Irish Bank. which closed on $2. having launched – and held a first close for – its ninth value-added global real estate fund. As Juan Pepa. In 2008. a commingled vehicle targeting real estate assets in New York.PERE 30 Headquarters: Dallas Founded: 1995 Capital raised since inception: $33 billion John Grayken’s Lone Star Funds was the story of last year’s rankings. in terms of volume of product in Europe.54 billion in February 2010.
AREA Value Enhancement Fund VIII. had launched its newest value-added vehicle. it also managed to close on equity commitments on behalf of some of its commingled funds. with commitments of roughly $100 million. Starwood wants to raise between $2 billion and $3 billion for the vehicle. but it was one of the few who found its offer actually worked.000 multifamily units and condominiums.4 billion for its ninth opportunity fund. it wasn’t all great news for AREA as John Jacobsson. PERE revealed earlier this year. a commingled value-added real estate fund. with a focus on established markets such as Hong Kong. It was among numerous funds to offer incentives to attract first closers. which cost the global property services firm approximately $1. 13 CBRE Global Investors $4. collectively known as MGPA Fund III. Focused on the UK. MAY 2012 | PERE 45 . According to an announcement in November.963 billion Headquarters: New York Founded: 1993 No. 14 million square feet of retail. as well as distressed debt. As a result of its fundraising dexterity. In addition. France.2 billion in equity commitments for MGPA Asia Fund III and MGPA Europe Fund III. and the fund would be able to borrow an equivalent amount to make investments. a partner and original member of the firm who oversaw its US opportunity funds platform. global chief executive Lee Neibart continues to steer this steadily growing ship in the right direction. not to mention more than 400 successfully tempted first closers debt deals and 20 operating companies. the firm broke its own mould this time around as it offered fee breaks to investors committing more than $150 million of equity. Malaysia. The firm attracted $5. Given that the European fund is well advanced in terms of deploying capital. 11 MGPA $5. said in an earnings call: “It is important to note that 2012 performance is likely to be more back-ended than usual due to the slow transaction environment we have experienced amid heightened market uncertainty. AREA Real Estate Opportunity Fund VI. and finally closed in June 2008. The first close is comprised of commitments from investors in MGPA Europe Fund III. Evidently. it said. Japan and Taiwan. the independent the ship real estate fund manager once known as Apollo Real Estate Advisors. Germany and Poland. closed on an initial $275 million in commitments in 2011. Singapore. an opportunistic co-investment vehicle. However.426 billion 12 Starwood Capital Group $4. the firm finds itself soaring up the ranking into 12th position. investors are keen for Barry Sternlicht’s firm to swallow even more. Our outlook for 2012 assumes a pickup in job growth. of real estate partners: 47 Between its inception in 1991 and September of last year. The New York-based firm held a final close for its latest opportunistic fund. 49. Starwood Capital Group has invested more than $10 billion of equity in 26 million square feet of offices.” 14 AREA Property Partners $3.2 billion. 62 million square feet of industrial. left earlier this year to pursue other opportunities. For example. Despite the attention needed by its nearly year-long takeover. commemorated 2011 with the close of one fund and the launch of another. Connecticut Founded: 1991 No. the firm currently is looking to raise $1 billion or so for its next European fund. To get there. by the end of the year.100 Last year marked the point when CBRE Global Investors – formerly just known as CBRE Investors – took control of ING Real Estate Investment Management from the Netherland’s ING Group. CBRE Strategic Partners US Value VI. Wood Partners Co-Investment Venture II. The intention is to raise up to €500 million in equity. On the firm’s overall outlook for 2012. In addition. closed on $140 million in equity during the year. Ultimately.035 billion Headquarters: Los Angeles Founded: 1972 No. South Korea. it is no surprise that MGPA is back in the market with a follow-on opportunistic vehicle. MGPA also is working on a core-plus German special fund aimed at making investments in the Asian region. given that the firm already has raised $1. on $518 million in June and. the firm held a first close on MGPA Europe Fund IV. the fund seeks to take advantage of current market dislocations and recapitalisations and is aiming to upgrade assets into core real estate.595 billion Headquarters: Greenwich.000 hotels and 5.PERE 30 Headquarters: London and Singapore Founded: 2004 Total assets under management: $11 billion MGPA maintains its high position in the PERE 30 thanks to major fundraising efforts in 2007 and 2008. Despite the setback. economic activity and sentiment by the summer.000 acres Sternlicht: of land. of real estate professionals: 111 Neibart: steering AREA Property Partners. more than 1. chief executive of parent company CBRE Group. AREA Value Enhancement Fund VIII is targeting $750 million in commitments to buy or recapitalise commercial properties across the US. Brett White. of employees: roughly 1.
which held a final close of $1. friends and colleagues. In addition. the firm is seeking commitments from international institutions for the first time.6 billion While no longer one of the top 10 firms.782 billion Headquarters: Parsippany. As it stands now. PERE understands that the firm has raised some $1.959 billion 16 TA Associates Realty $3. a little more than one year later.300-room hotel. a value-added real estate vehicle that will pursue senior housing investments such as independent-living and assisted-living facilities in North America. and is on track to make its first investment during the second quarter. The firm also is in the market with PLA Residential Fund V. 17 Angelo. Rockpoint Real Estate Fund IV. when it acquired the 176-unit Woodland Terrace in Cary. valued at between $230 million and $240 million. the equity haul itself has shown that there is life after Barket and that the Angelo. the firm may invest up to 25 percent of its capital in Canada and the UK. 46 18 Rockpoint Group $3. would see the duo invest more than $75 million of additional equity for a complete renovation of the 1. Prudential reportedly is raising an industrial development vehicle for Brazil and a North America-focused opportunistic real estate fund. Milford Plaza PERE | MAY 2012 . TA Realty was back in the market last summer with Fund X. The vehicle will mostly be focused on the US but. the Boston-based firm acquired the Milford Plaza Hotel in New York’s theatre district through a joint venture with hospitality investment company Highgate Holdings. which SEC filings show held a first close of more than $483 million in equity in March. However. Realty Associates Fund VIII. according to documents from the Nebraska Investment Council. In November of that year. Early last year. It is remarkable then that. the firm has managed to climb the PERE 30 ranking by closing on $1. North Carolina through a joint venture with Kisco Senior Living.74 billion in 2007.PERE 30 15 Prudential Real Estate Investors $3. there also were various key-man issues Barket: his with which to contend. had closed on nearly $550 million of commitments as of press time and is expected to raise a total of more than $800 million by the end of the second quarter. Headquarters: Boston Founded: 1982 Gross assets under management: $11. The fund closed on a total of $568 million in commitments last month and made its first investment in October. Obviously.05 billion in commitments for the fund. Rockpoint launched its latest investment vehicle. with the focus largely on US distressed assets but with the added ability to invest in Europe and Asia. Apart from the sad personal ramifications of such an event for family.1 billion One of this year’s bigger risers.567 billion Headquarters: Boston Founded: 2003 Currently raising: Rockpoint Real Estate Fund IV Hotel: Rockpoint’s In 2010. Fund IX. Adding to PREI’s list of specialty fund closings is Senior Housing Partners IV.5 billion of equity in 2010.5 billion in July 2007. and its successor. These include its $1 billion Asia Property Fund II in 2009 and a Latin America residential fund that raised $867.27 billion for its AG Realty Fund VIII. The deal. Meanwhile. evidently. Wherever the money goes.683 billion Headquarters: New York Founded: 1988 Current equity under management: $22 billion Angelo. it passing did not also meant that any fundraising efforts deter investors needed to be put on hold. Fund X is targeting $1. according to investor presentations by the firm. an opportunistic vehicle through which it plans to acquire distressed commercial and residential properties and/or debt from owners and lenders. Rockpoint Group was focused big ‘get’ predominantly on distressed US real estate deals. Fund IV is following a strategy similar to that of Fund III. which will invest in office. TA Associates Realty moved up seven spots as several rival firms fell back in the PERE 30 ranking. the firm –a separate entity from Boston-based private equity shop TA Associates – also achieved hefty capital hauls with its value-added real estate investment vehicles. industrial.5 billion in equity commitments. New Jersey Founded: 1970 Gross assets under management: $48. which is targeting the Mexican pesos equivalent of $500 million and will focus on sustainable housing development in that country. upwards. targeting roughly $2. Gordon & Co show will go onwards and. Gordon & Co $3.5 million in 2008. Prudential Real Estate Investors (PREI) successfully raised several regionally-focused funds in recent years to land solidly in the middle of the PERE 30 ranking. which closed on $2. Gordon & Co was undoubtedly rocked in its capital-raising efforts by the death of senior manager and global head of real estate Keith Barket in December 2010.25 billion in capital. retail and multifamily properties across the US. which raised $1. in addition to targeting US investors. The vehicle.
65 billion Merrill Lynch Asian Real Estate Opportunities Fund. Seol principally stayed to aid the bank as it worked through legacy assets and represent its interest in its biggest vehicle. a start-up platform spun out of Bank of America Merrill Lynch and led by Roger Barris. In the past year or so. Meanwhile.23 billion of capital commitments last year. The pan-Asia fund was closed at the end of 2008. while efforts are afoot in the US for a follow-on value-added vehicle. the firm is owned by Paris-based Natixis Global Asset Management. In July.867 billion Headquarters: Houston Founded: 1957 No. 21 AEW Global $2. Shorenstein concluded the investment period for Fund Nine with the purchase of 13031 Jefferson Boulevard. a 1. AEW Europe is now raising its next European opportunity fund. that fund forms the lion’s share of the now-defunct platform’s capital. Natixis is owned by BPCE. is no longer within the five-year window for consideration. the firm made its first purchase on behalf of Fund Ten in late January. acquiring 350 West Mart Center. California. The global property firm also has been active recently in the US multifamily market. head of Asia at Bank of America Merrill Lynch GlobSeol: last to leave al Principal Investments. including a $75 million co-investment from Shorenstein. it’s unlikely that Hines will be slowing down its fundraising activities anytime soon. Comprised of AEW Europe and AEW Capital Management. MAY 2012 | PERE 47 . 350 West Mart Center: Still. Earlier this year. At this pace. a 20-acre commercial site in Playa Vista. of real estate professionals: 997 Clearly. which raised $2. the Hines Russia & Poland Fund closed on $473 million for opportunistic real estate investments in those two markets.871 billion Headquarters: Paris and Boston Founded: 1981 Total assets under management: $47 billion AEW Global is the only European financial services-owned firm to make it onto the PERE 30. tendered his resignation in February. just months before Merrill Lynch was acquired by Bank of America. which was raised in 2008. as it closed last year on $158 million and $210 million for the fourth and fifth offerings of its Brazil Fund.261 billion Headquarters: New York Life: 2005-2010 Assets under management at its peak: $8 billion When Martin Seol. which closed on $1. from Vornado Realty Trust.295 billion 20 Headquarters: San Francisco Founded: 1992 Total capital raised since inception: $6. the platform finally lost its last senior executive. AEW European Partners. Earlier this year. Hines closed on $111 million for Hines Multi-Family Investment Partners. Remaining long after the investment bank opted to exit the real estate space. Bank of America Merrill Lynch Global Principal Investments $3. the $1. In particular. the San Francisco-based firm Fund Ten’s first deal remains a solid contender. In turn. 22 Hines $2.06 billion in 2007. as the Houston-based fund manager has been nearly relentless in its global investment and fundraising activity. and Fund Ten. which was created out of a merger of two big French banks in 2009. one of the largest asset management groups in the world with around €544 billion in assets under management. a commingled opportunistic vehicle targeting multifamily properties in North America. Hines appreciates the value of diversiHines: focused on emerging markets fying its portfolio. as well as four smaller value-added and opportunistic funds targeting the US and the AsiaPacific region. as well as Central and Eastern Europe. AEW Value Investors III.2 million-square-foot office property in Chicago. the $2. Hines has raised nearly $1 billion in equity commitments for opportunistic investments in North and South America. now that its 2006 vintage fund. Now under the stewardship of The Blackstone Group. As reported in March. respectively. thanks to the significant amounts of capital it has rounded up for its subsequent funds: Fund Nine. France’s second-largest bank.6 billion Shorenstein Properties is down three places in the PERE 30 ranking this year.1 billion Shorenstein Realty Investors Eight. AEW Global owes its presence in the PERE 30 to a combination of a $1 billion European opportunistic fund called the AEW European Property Investors Special Opportunities Fund.PERE 30 19 Shorenstein Properties $3. Hines continues to find some traction within the emerging markets. That capital is supplemented in its five-year haul by two funds in Europe now under the management of Peakside Capital.
Bruce Flatt.86 million in 2010.604 billion Headquarters: Toronto Year founded: 1899 Total assets under management: $150 billion Brookfield Asset Management is an undisputed real estate heavyweight. Headquarters: Philadelphia Founded: 1997 Total equity invested since inception: $6.05 billion Lubert-Adler Real Estate Fund VI. Grove has been focusing on North America in the belief that the market has dramatically increased in attractiveness.464 billion Headquarters: New York Founded: 2004 Number of investors: More than 80 While Grove International Partners has offices in such global cities as New York. through which it raised $410 million earlier this year. Notably. did close on $400 million in equity last year for the fund’s second co-investment vehicle. has yet to take off as a significant proportion of its current five-year equity haul comes from Latin and North American funds raised in 2007 and 2008 or via sector-specific. which means that much of its global headcount got redeployed last year. PERE | MAY 2012 .5 billion in equity in 2009 when the world’s LP community was taking a hiatus from traditional blind-pool. 25 JER Partners $2. the firm’s chief executive. with Fund VI now 85 percent invested and Fund VI-A and VI-B each 50 percent invested. Despite making a return to the ranking this year after being on the cusp for the past couple of years. the firm joined forces with TPG Capital and Pacific Investment Management last August to bid on the $9.5 billion Lubert-Adler Partners dropped six spots in this year’s ranking in part because its 2006 vintage fund. That is because the senior partners at Grove have jointly devised a new strategy for the firm to focus investment activity on the US. Robert: leadership lost Founder Joseph Robert passed away in December.73 billion Lubert-Adler Real Estate Fund V. Fund VI-B. leaving the new management team to focus on its US assets.496 billion Headquarters: McLean. that product finally arrived. That left management of the firm to senior director Michael McGillis and veterans Keith Belcher and Daniel Ward. Lubert-Adler has actively been looking to deploy capital. Fund VI-A. where early deals have included two large acquisitions involving office repositions. For the past two years. Meanwhile. the $2. Wells Fargo and JPMorgan Chase. The fund. who runs Event Holding in Cologne. which ultimately went to the team of Lone Star Funds. The firm jettisoned its Latin American business and transferred its European platform to LaSalle Investment Management. it appears. Fund VI-B will target discounted loan payoffs and the subsequent recapitalisation of borrowers and assets. Lubert-Adler. Virginia-based JER Partners arguably has endured a more turbulent year than any other firm in the PERE 30. That capital will be reserved for new deals and barred from investing in legacy assets held by Fund VI and another sidecar. The Flatt: mega fund in the offing firm’s Real Estate Turnaround Consortium. The Philadelphia-based private equity real estate firm also still hasn’t brought to market a successor to its 2008 vintage fund. is pursuing a new hospitality platform in the region with Anders Braks. The $2 billion-plus in equity that counts towards the PERE 30 ranking was raised in 2007 and 2008 via two separate Europe funds and one in North America. was no longer within the ranking’s five-year window. it no longer has an office in London. however. Behind the decision to shrink in Europe was a general stance that. the market was not a great place to invest. admitted to a PERE conference audience that the non-discretionary club’s capital was a prelude to a more traditional product. even if its private equity real estate heft remains in question. relative to the US. JER Partners has been shrinking its operations. commingled funds. Frankfurt and Tokyo. however. It also has a venture in New York with William Macklowe called WMC. and chief executive Barden Gale handed in his resignation that same month. Virginia Founded: 1981 Total equity commitments since inception: More than $4 billion McLean.PERE 30 23 Brookfield Asset Management $2. which collected $148. Los Angeles. Grove.65 billion US loan portfolio of Anglo-Irish Bank. which ultimately attracted $5. attracted both praise and skepticism. value-added vehicles like its Brookfield Industrial Partners Fund. The firm has a venture in California with Ned Fox called VPI. 48 26 Grove International Partners $2. In May 2011. it is possible that the firm will fall out of the PERE 30 altogether unless it can raise a sizable fund by next year. the $1. Brookfield Strategic Real Estate Partners is intended to bring in approximately $4 billion in equity and propel the Toronto-based firm into the same realm as its investment management contemporaries like The Blackstone Group.728 billion 24 Lubert-Adler Partners $2.
DRA has acquired a total of eight properties valued at more than $220 million through the vehicle. a 226unit apartment community in Collierville. the firm is back in the market with Fund VII. At press time. 30 Walton Street Capital $2.PERE 30 27 CIM Group $2.7 million. CIM plans to lease up the building. entity recapitalisations and private equity platform investments. In addition. retail. More recently. which can accept capital on a more frequent basis. which currently is 70 percent vacant.371 billion 28 Northwood Investors $2. Fundraising for the vehicle nearly matched that of its predecessor.31 billion in equity in 2007. Fund VI. in April 2011. the firm closed on $277. CIM has been doing anything but that when it comes to acquisitions. Northwood recently acquired a portfolio in the southeastern US for more than $160 million. Block 37: CIM’s latest acquisition Headquarters: New York Founded: 2006 No. benefitted from a lower fundraising threshold to make the list this time around. That and the strength of its North America-focused opportunistic fund CIM Real Estate Fund III. Bluhm: looking to MAY 2012 | PERE 49 . a nearly complete 50-storey glass condominium tower that had been tied up in court proceedings for more than two years. although it is longer than that of the typical closed-ended fund. The fund. Prior to Fund VI. DRA Advisors makes a return to the PERE 30 ranking with the help of its latest value-added real estate fund.4 million. which closed on $2. which is targeting $2 billion in equity commitments for value-added and distressed properties in the US. whereby Kukral: pioneering the vehicle may add capital once each a new fund model calendar year. CIM Group is a newcomer to the PERE 30. respectively. marking its first foray into Brazil. which targets the office.25 billion in equity in 2008. As the former global real estate head of The Blackstone Group from 2002 to 2005. which closed on $1.05 billion.212 billion Headquarters: Chicago Founded: 1994 Currently raising: Walton Street Real Estate Fund VII Latin America Walton Street Capital has been one of the more successful fundraising firms following the global financial crisis. Tennessee. it was announced last month that CIM had joined a group of creditors in winning control of New York’s One Madison Park. Having closed on $1.1 billion last year for the second offering of its fund. he helped the private equity and real estate giant close its fourth and fifth funds on €600 million and $2. Since then. it was revealed that Walton Street had partnered with Brazilian bank BTG Pactual for a 50 percent stake in the Golden Square Shopping Mall in Sao Paulo. acquiring a 9 million-squarefoot industrial portfolio from Weingarten Realty for $382. DRA Growth and Income Fund VII. has a unique ‘evergreen’ structure.1 million for its Mexican properties vehicle. Walton Street also has expanded its presence in Central and Southern America. Despite laying low in the fundraising space. of investment professionals: 13 Northwood Investors is another firsttimer to the PERE 30 ranking. thanks in part to a fundraising of nearly $1. Additionally. His new firm now is seeking to deploy capital on behalf of NREP I. It was revealed in April that the firm acquired Block 37. That fund. which was launched in March 2011. Fund VII will target properties in the office and hotel segments. The Los Angelesbased fund manager.250 billion Headquarters: New York Founded: 1986 No. which is the brain-child of founder John Kukral.94 billion for its Walton Street Real Estate Fund VI in 2009. which had been on the cusp of making the ranking for the past few years. a troubled retail centre in downtown Chicago. the fund has a definite life. 29 DRA Advisors $2. Northwood Real Estate Partners (NREP) I.5 billion Although it has not raised a new commingled fund since the global financial crisis. of real estate professionals: 64 After a two-year absence. Indeed. In particular. Walton Street Mexico Fund I. multifamily and industrial sectors in the US. in partnership with Memphis-based Fogelman Venture Partners for $15. That is distinct from traditional open-ended funds. for $84 million from Bank of America. the firm was under contract to make its biggest purchase yet.310 billion Headquarters: Los Angeles Founded: 1994 Total assets under management: $9. made its first investment on behalf of it latest fund in June. The firm acquired the Orchards at Collierville. Kukral should know a thing or two about successful fundraising. DRA. which is targeting distressed real estate companies and assets. The Chicago-based fund manager has invested in an array of different real estate ranging from single-asset transactions to complex ownership situations. held a final close on $1 billion just seven months later.
Below are the 10 biggest closers of capital Equity raised (US$m) $10.340.265.050. Gordon & Co Northwood Investors Rockpoint Group Oaktree Capital Management DRA Advisors Fund name Blackstone Real Estate Partners VII* Lone Star Real Estate Fund II Carlyle Realty Partners VI KSL Capital Partners Fund III Starwood Global Opportunity Fund IX* AG Realty Fund VIII Northwood Real Estate Partners I .000.03 $5.43 $4.57 $3.86 $5.second offering Rockpoint Real Estate Fund IV* OCM Real Estate Opportunity Fund V DRA Growth & Income Fund VII Note: * still in market 50 PERE | MAY 2012 .0 $1.400.0 $1.0 $1.0 $2.90 $6.10 $12. Gordon & Co Rockpoint Group Shorenstein Properties Bank of America Merrill Lynch Global Principal Investments AEW Global Hines Brookfield Asset Management Lubert-Adler Real Estate JER Partners Grove International Partners CIM Group Northwood Investors DRA Advisors Walton Street Capital $0 Source: PERE $29.68 $3.025.2 billion in their capital-raising totals The Blackstone Group Morgan Stanley Real Estate Investing Goldman Sachs Real Estate Principal Investment Area Tishman Speyer Colony Capital The Carlyle Group Lone Star Funds Beacon Capital Partners Westbrook Partners LaSalle Investment Management MGPA Starwood Capital Group CBRE Global Investors AREA Property Partners Prudential Real Estate Investors TA Associates Realty Angelo. The second through fifth largest firms are clustered together in the $12 billion range.96 $3.6 billion to just over $2.PERE 30 Sizing up the Pere 30 A graphic representation of the 2012 PERE 30 shows that The Blackstone Group has raised a disproportionately larger amount of capital over the past five years.65 $9.96 $3.78 $3.64 $7. but some firms were able to close on significant amounts of capital in 2011 and the first few months of 2012.060.31 $2.0 $2.46 $2.30 $3.0 $1.0 $1.21 $5 $10 $15 $20 $25 $30 Capital raised over last five years (US$bn) Top 10 recent fundraising efforts The fundraising environment for private equity real estate funds may have been challenging.200.500.87 $2.0 year of final or interim close 2012 2011 2011 2011 2012 2012 2011 2012 2011 2011 rank 1 2 3 4 5 6 7 8 9 10 Firm The Blackstone Group Lone Star Funds The Carlyle Group KSL Capital Partners Starwood Capital Group Angelo. after which the remaining 25 firms gradually decline from $9.0 $5.26 $2.58 $6.73 $2.0 $1.12 $12.60 $2.50 $2.87 $2.60 $4.04 $3.67 $12.000.10 $11.25 $2.37 $2.
449 $5. For net buyers. The Carlyle Group topped all sellers.924 Beacon Capital Partners $2.761 $2.000 $20.978 $3.601 Tishman Speyer $1.826 $2.000 $6.000 $10.241 LaSalle Investment Management $2.000 $6.000 $15.000 $8.000 $10. covers activity by the parent companies as well as by a firm’s dedicated real estate funds.000 $12.004 $4. The Carlyle Group led all firms with $12.982 $2.000 $25.000 $8.945 $5.474 The Carlyle Group $1. It includes direct property transactions only.000 Sales volume in $m $10. with more than $24 billion in net purchases. look no further than The Blackstone Group. The Blackstone Group was far and away the most active buyer. the firms of the PERE 30 engaged in both the buying and selling of real estate assets over the five quarters since the start of 2011.000 $10. The data is believed to be accurate but is not guaranteed.000 $2.505 Purchase volume in $m $30.000 $5.3 billion of property since the start of 2011. offloading nearly $14 billion in real estate assets over the past five quarters.958 $612 Westbrook Partners $582 Colony Capital Net results With just a few exceptions.000 $4. 2012. © Real Capital Analytics. $16.000 $25.000 $0 The Blackstone Group $3.com MAY 2012 | PERE 51 .261 Goldman Sachs $616 Westbrook Partners $158 Colony Capital $132 Lone Star Funds $28.000 $5. according to Real Capital Analytics.000 $0 The Carlyle Group Goldman Sachs Lone Star Funds JER Partners LaSalle Investment Management $4.000 Sales volume in US$m $30. http://rcanalytics. outdistancing the next closest firm – LaSalle Investment Management – by more than $25 billion.000 $12.000 $20.081 $967 $490 CIM Group $401 DRA Advisors Northwood AEW The Investors Capital Blackstone Group Management *Data provider Real Capital Analytics has tracked the volume and value of property transactions for the PERE 30 firms from January 2011 to the end of March 2012.000 $0 The top 5 net buyers $24.335 $2.154 $1. Among net sellers.555 Morgan Stanely $1.187 $2. the top 10 firms in this year’s PERE 30 sold $45.000 $2.000 Sales volume in US$m $14.623 Selling activity of the top 10 firms According to Real Capital Analytics. full deal credit is allocated to both joint venture partners.000 $0 The Carlyle Group LaSalle Investment Management Goldman Sachs Morgan Stanely The Blackstone Group Tishman Speyer Beacon Capital Partners Lone Star Funds $5.6 billion of property since the start of 2011. The top 5 net sellers $14.000 $15. $35.5 billion in net sales.703 $12.PERE 30 Buying activity of the top 10 firms The top 10 firms in this year’s PERE 30 purchased some $42.000 $4.469 $13. Inc.
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