In Q2 2012, 27 private equity real estate vehicles reached a final close on an aggregate $7.5bn in commitments. Many investors appear to be continuing to invest in more established markets, with North America-focused funds remaining a preference for investors. Funds with a primary focus on North America raised the most capital in Q2 2012, with 17 funds receiving aggregate commitments of $4.7bn during this period. The largest primarily North America-focused fund to close in this period was the opportunistic AGRE U.S. Real Estate Fund, which raised $713mn to invest in distressed debt and equity recapitalization transactions. The fund also pursues opportunities to acquire and recapitalize real estate portfolios, platforms, and operating companies, including non-performing and deeply discounted loans.
Five primarily Europe-focused funds closed in the quarter, having raised a total of $1.8bn, while five Asia and Rest of World-focused funds closed on an aggregate $0.9bn. The largest fund to close in the quarter was Niam Nordic V, which closed on €719mn. The opportunistic vehicle is targeting commercial and residential property investments in Sweden, Norway, Finland and Denmark. The largest Asia-focused fund to close was Forum Asian Realty Income III Fund, an opportunistic vehicle managed by Forum Partners, which raised $374mn.
North America-focused funds have consistently raised the most equity from real estate vehicles since 2005. Funds focused on North American markets accounted for 63% of all the equity raised by real estate vehicles that closed in Q2 2012, compared to the 65% and 58% of the total raised they accounted for in 2011 and 2010 respectively. In Q2 2012, Europe-focused funds accounted for 24% of aggregate capital raised, while Asia and Rest of World-focused funds made up 12%.