preqin q3 2010 private equity real estate fundraising
TRANSCRIPT
Fig. 1: Top Five Largest Real Estate Funds to Close in Q3 2010
Fig. 5: Average Time Taken for PERE Funds to Achieve a Final Close by Year Fund Closed
Fig. 3:Private Equity Real Estate Fundraising by Primary Geographic Focus, Q3 2010
13
1
56.0
0.81.9
02468
101214
North America Europe Asia and Rest of World
No. of Funds Aggregate Capital Raised ($bn)
© 2010 Preqin Ltd. / www.preqin.com
Preqin Research Report Q3 2010 Private Equity Real Estate Fundraising Update
Preqin provides information, products and services to real estate fi rms, fund of funds, investors, placement agents, law fi rms, advisors and other professionals across six main areas:
> Fund Performance> Fundraising> Fund Manager Profi les> Investor Profi les> Fund Terms> Compensation and Employment
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9.8 1012.6
18.2 18.9
0
5
10
15
20
2006 2007 2008 2009 2010 YTD
Fund Firm Strategy Size (mn) Manager Country
Fund Focus
Fortress Credit Opportunities Fund II
Fortress Investment Group
Debt and Distressed 2,600 USD US Global
TA Realty Associates IX
TA Associates Realty
Core-Plus, Debt, Distressed and Value Added
1,700 USD US US
Brockton Capital II Brockton Capital Debt, Distressed and Opportunistic 496 GBP UK UK
AG Asia Realty Fund II
Angelo, Gordon & Co
Distressed and Opportunistic 625 USD US Asia
AG Net Lease Realty Fund II
Angelo, Gordon & Co Value Added 550 USD US US
2 3 3 51010
611
1612
18
2723
2723
2724
3631
3534
4342
21
1514
9 1015
8 9
05
1015202530354045
Q1
2003
Q2
2003
Q3
2003
Q4
2004
Q1
2004
Q2
2004
Q3
2004
Q4
2004
Q1
2005
Q2
2005
Q3
2005
Q4
2005
Q1
2006
Q2
2006
Q3
2006
Q4
2006
Q1
2007
Q2
2007
Q3
2007
Q4
2007
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010
Fig. 2: Global Private Equity Real Estate Fundraising, Q1 2003 - Q3 2010
There was an increase in aggregate capital raised in Q3 2010 from the previous quarter of 14%, with 19 funds closing with aggregate commitments of $8.7 billion, up from the $7.6 billion raised in Q2 2010. However, since 2005 there have only been two quarters in which less capital was raised, demonstrating that fundraising remains extremely challenging in the current environment. 13 primarily North America-focused funds raised a total of $6.0 billion, one primarily Europe-focused fund closed on $0.8 billion, and fi ve primarily Asia and Rest of World-focused funds raised $1.9 billion.
The aggregate target of funds currently on the road seeking capital continued to decline over Q3 2010, as Fig. 4 shows. However, the number of funds in market increased to 403 over the period, perhaps suggesting a slight increase in fund
manager confi dence in the prospects for fundraising in the coming months.
The average time taken for private equity real estate funds to reach a fi nal close has continued to increase over 2010, as Fig. 5 shows. Funds closed in 2010 to date have taken an average of 18.9 months to reach a fi nal close, up from 18.2 months in 2009 and nearly double the average time taken for funds closing in 2006.
The largest fund to close in Q3 2010 was Fortress Credit Opportunities Fund II. The vehicle aims to make investments in a range of distressed and undervalued credit investments including, but not limited to, opportunistic corporate loans and securities, residential loans and securities, commercial mortgage loans and securities and other consumer or commercial assets and asset-backed securities.
Full results and report on Q3 2010 PERE fundraising will be available in Preqin’s monthly newsletter, Real Estate Spotlight.
To register to receive Spotlight please visit: www.preqin.com/spotlight
Fig. 4:Private Equity Real Estate Funds on the Road over Time, Q1 2007 - Q4 2010
76
273
381 390 378 363 376 383 378 403
33
127
228 227 199 178 173 147 134 132
050
100150200250300350400450
Q1 2007
Q1 2008
Q1 2009
Q2 2009
Q3 2009
Q4 2009
Q1 2010
Q2 2010
Q3 2010
Q4 2010
No. of Funds in Market Aggregate Target ($bn)
Agg
rega
te C
apita
l Rai
sed
($bn
)
Aver
age
Tim
e S
pent
in M
arke
t (M
onth
s)
Source: Preqin
Source: Preqin
Source: Preqin
Source: Preqin
Source: Preqin