Europe-Focused Real Estate Fundraising

by Jonathan Ma

  • 09 Dec 2011
  • RE

Since 2006, 397 Europe-focused closed-end real estate funds have raised a total of €63.3bn. The most successful year, in terms of aggregate commitments, was 2008 with a total of €19.2bn was raised. Despite this, however, the greatest number of private real estate funds raised was in 2007, which saw 110 funds reach a final close. Since 2007, there has been a gradual decrease in the number of funds being raised in Europe, dropping from 110 in 2007 to 23 in the period of January 2011 – November 2011.

There are currently 101 private real estate funds in market targeting Europe, seeking an aggregate target is €27bn. There are currently 61 funds adopting a diversified property strategy, with an aggregate target of €17bn. The most popular property focus in Europe is retail, with 14 funds targeting an aggregate of €4.5bn. Funds focusing on office properties account for €2.1bn of the total target and there are currently eight funds on the road that adopt this focus. Six of the funds currently seeking capital adopt a niche property focus, looking to raise €0.7bn, whereas five funds have a preference towards hotel properties (seeking a total of €1.6bn). There are also five funds on the road that seek to invest in residential properties; however the aggregate target of these vehicles is much smaller, standing at €0.7bn. Finally, just two of the funds currently in market have a focus on industrial properties, with these funds seeking an aggregate €0.4bn of capital from investors.

Of the 101 private real estate funds in market, 34 funds are managed by UK-based firms and have an aggregate target of €8.5bn, while the US is the headquarters for managers of 15 Europe-focused funds, which are seeking a total of €5.9bn. Germany is the base for 10 firms targeting €2.4bn in total and nine funds managed by France-headquartered firms, which are targeting a total of €4.6 bn.  

The top 10 Europe-Focused managers, by capital raised, from 2006 – November 2011 have raised a total of €20.3bn. Of these managers, six are based in the US, three in the UK and one in France.  On this basis, the most successful fund managers are Blackstone Group (having raised €3.1bn), Grove International Partners (having raised €2.5bn) and Carlyle Group, (having raised €2.2bn).

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