There are currently 44 private equity real estate funds on the road managed by UK-headquartered fund managers, seeking to raise an aggregate $14.6bn in commitments from investors. Of these funds, 34 are Europe-focused and have a target of $12.3bn, whereas seven are targeting investments in Asia and Rest of World (seeking equity commitments of $2.2bn). The remaining three funds are focused on acquiring properties in North America and are seeking a total of $1.2bn in commitments. Forty-three percent of real estate funds currently on the road include retail assets as part of their investment focus, while 36% are seeking capital to invest in office properties. Fourteen percent of these funds are targeting residential and industrial-focused assets, whereas 10% are seeking to invest in hotels assets.
Since 2005, a total of 179 funds managed by UK-headquartered fund managers have closed, attracting an aggregate $58.7bn from investors. The years between 2006 and 2008 saw the highest amount of capital raised for UK-based fund managers, with a total of 108 funds raising a total of $36.3bn during this period. In 2005, 19 funds closed raising an aggregate $6.3bn in capital, rising to $16.2bn from 34 funds in 2008. Since 2008, however, the amount of capital raised by UK-based firms has declined, with 22 funds raising an aggregate $7.3bn in 2009 and 14 funds raising $4.5bn in 2011.
The largest real estate funds currently on the road managed by UK-headquartered firms include Orion European Real Estate Fund IV, which is targeting €1.3bn for opportunistic investments throughout West Europe. Elsewhere, MGPA Europe Fund IV is targeting $750mn in order to invest in opportunistic and value added properties located in Europe. Threadneedle Low-Carbon Workplace Trust, managed by Threadneedle Property Investments, is seeking £350mn in capital to invest in office and commercial properties located in the UK. The fund provides investors with the potential to achieve attractive returns from the refurbishment and ownership of low carbon compliant buildings.