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Office-Focused Private Real Estate Fundraising January 2012

by Jonathan Ma

  • 27 Jan 2012
  • RE

There are currently 32 solely office-focused real estate funds in market looking to raise an aggregate $12.2bn from investors. These funds adopt a diverse range of strategies including core, core-plus, debt, distressed, opportunistic and value added. There are nine Europe-focused funds targeting $3bn, 18 US-focused funds targeting $7.1bn and five Rest of World-focused funds targeting $2.1bn.  In total, 13 of these funds have held at least one interim close.

The two largest office-focused funds currently seeking capital are Paramount Group Real Estate Fund VII and Blumberg Strategic Asset Fund; each looking to raise $1bn. Both funds have a US focus, with Blumberg also extending its focus to real estate opportunities in Canada. Paramount Group Real Estate Fund VII adopts a value added strategy, while Blumberg will make core-plus investments.

Between 2006 and 2011, 60 solely office-focused real estate funds closed, raising an aggregate $27.6bn. Twenty-seven Europe-focused funds raised $4.9bn, while 25 US-focused funds raised $21.5bn and eight Rest of World-focused funds raised a total of $1.2bn.

The largest two funds to close were Beacon Capital Strategic Partners V and Beacon Capital Strategic Partners VI. Managed by Beacon Capital Partners, the two funds raised $4bn and $2.5bn respectively. Beacon Capital Strategic Partners V closed in 2007 and it adopts a value added strategy targeting office properties in Europe and the US. Beacon Capital Strategic Partners VI has a similar strategy and reached a final close in 2011.

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