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Residential-Focused Real Estate Fundraising – 2006 to July 2012

by Jonathan Ma

  • 03 Aug 2012
  • RE

Currently, 75 residential-focused funds are on the road with an aggregate target of $14.5bn, according to Preqin’s latest data. From 2006 to July 2012, residential-focused funds raised an aggregate $37.3bn and in the last 10 years they raised an aggregate $44.7bn.

From 2006 to July 2012, the aggregate capital raised by residential-focused funds saw a downward trend. In 2006, 39 funds raised an aggregate $10.8bn but in 2007 only $8.7bn was raised despite an increase of 11 more closed funds compared to 2006. The number of funds fell to 37 in 2008 and the aggregate capital raised fell to $5.8bn. In 2009 the number of closed funds fell to 24, raising an aggregate total of $3.8bn. The number of funds closed in 2010 rose to 32 but the aggregate capital raised fell to $2.6bn. 2011 saw recovery, when 28 funds raised an aggregate $4.5bn, but fundraising has been slow from January to July 2012, with eight funds raising $1.1bn.

Of the funds currently on the road, the majority, 50 funds targeting $9.8bn, are North America-focused. Asia and Rest of World is the second most popular geographic focus, with 17 funds targeting $2.7bn. The remaining eight funds are Europe-focused and have a combined target of $1.9bn.

The largest residential-focused fund currently in market, Selene Residential Mortgage Opportunity Fund II, is managed by Selene Investment Partners and targeting $1bn. The fund is North America-focused but has the capacity to invest globally if the correct opportunity arises. The fund also adopts a debt and distressed strategy and focuses primarily on delinquent residential mortgages.

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