Private real estate fund managers have more than $250bn (€225bn) in dry powder, or unspent committed capital for investments, according to Preqin.
A buoyant fundraising market has provided managers of closed-end private real estate funds with significant capital, Preqin said. The figure is up 37% on the $185bn at the end of last year.
Opportunistic vehicles have the highest amount of capital available to invest globally at $100bn.
Andrew Moylan, head of real assets products, said the level of uncalled capital available is a reflection of a strong fundraising environment, as institutional investor confidence in real estate continues to increase.
“However, with increasing valuations and intense competition, finding attractive opportunities to invest this capital in the coming quarters is likely to be a difficult prospect,” he said. “Fund managers will have to work hard to find value in an increasingly crowded marketplace.”
Moylan said there is a competitive fundraising market, with 416 funds currently being marketed.
“This will make raising capital a challenging prospect for many over the second half of the year,” he said.
The second quarter of this year saw 47 real estate funds secure $26bn, bringing the 2015 total so far to $60bn. Preqin said the figure is the second highest for a half year since the financial crisis.
The majority of capital is focused on North American real estate, with $133bn focused on the region.
In the second quarter, 22 North America-focused funds raised a combined $10.3bn, while 11 European offerings raised $12.8bn. A total of $2.5bn was raised by Asia-focused funds and $400m by funds investing across other regions.
Preqin said 62% of funds reached or exceeded their target size in Q2 2015.
