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Thursday, 03 January 2013

North American Real Estate Funds Led in 2012 Capital Raising

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Commercial Real Estate Direct Staff Report

Real estate investment funds targeting properties in North America dominated the field in raising money during 2012, accounting for 74 percent of the capital raised by all closed-end property funds worldwide.

The $40.3 billion raised by the funds targeting North American assets in marketing campaigns that concluded in 2012 was up about 3 percent from the year before, while capital raising by funds targeting all other markets dropped 17 percent to $14.1 billion. That's according to preliminary results reported by Preqin, a London investment funds research firm.

Funds targeting North America also led the field of those that completed marketing in the fourth quarter, when 12 such vehicles raised $17.9 billion. That compares to 10 European-focused funds that raised $1.8 billion; two Asia-focused funds that also raised $1.8 billion; and the $1 billion raised by three funds targeting other areas.

The tallies for equity raising could be adjusted upward when Preqin completes it final full-year 2012 report later this quarter.

"North America is home to the largest real estate market and so funds focused there have always raised the most capital, but there has been a move among many institutional investors to focus on more established, liquid real estate markets, so there's been less appetite for emerging markets," said Andrew Moylan, real estate data manager at Preqin's London office. "The uncertainty in Europe has also meant that many U.S.-based investors have tended to focus on domestic investments."

North American funds' 74 percent share of the equity raised by all real estate funds last year was up from 69 percent in 2011 and 58 percent in 2010.

North American-focused funds also continued getting larger last year. The average size of the 86 such vehicles that closed was $469 million, compared to averages of $446 million and $329 million in 2011 and 2010, respectively.

The North American fund average was skewed upward in the fourth quarter when Blackstone Group completed marketing its Blackstone Real Estate Partners VII, which raised $13.3 billion.

Other large funds that closed last quarter include Westbrook Partners' Westbrook Real Estate Fund IX, which raised $1.6 billion for value-add investments in North America, Japan, England and France; Angelo, Gordon & Co's AG Realty Fund VIII, which raised $1.26 billion for opportunistic deals in North America and worldwide; and CBRE Global Investors' CBRE Strategic Partners U.S. Value 6, with $1.1 billion for value-add deals in the U.S.

Comments? E-mail John Covaleski or call him at (267) 247-0112, Ext. 208.


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Data Digest







Top Bookrunners
Private-Label CMBS - FY2014
Inv Bank #Deals Bal $mln MktShr%
Deutsche Bank 27.1  23,479.37 26.3
JPMorgan 18.6  13,752.01 15.4
Wells Fargo 17.2  13,085.05 14.6
Goldman Sachs 9.0  7,896.25 8.8
Citigroup 9.1  7,526.97 8.4





cppichart FP





Top Loan Contributors
Private-Label CMBS FY2014
Lender Vol $mln MktShr%
Deutsche Bank 14,005.13 16.0
JPMorgan 11,440.63 13.0
Wells Fargo 5,849.16 6.7
CCRE 5,750.69 6.6
Citigroup 5,604.13 6.4





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