UK private markets fund manager Bridgepoint is expanding into real estate through the acquisition of the US property arm of Kayne Anderson Capital Advisors for $1.39bn (€1.22bn).
The London-listed firm is funding the acquisition of Kayne Anderson Real Estate with $759m in cash and approximately 189m new Bridgepoint shares, with further payments tied to management fee-related performance targets.
The combination of Kayne Anderson Real Estate’s $22bn assets under management with Bridgepoint’s existing $30bn infrastructure business will create a real assets division that accounts for 45% of the group’s total $117bn portfolio, up from a third today.
It also gives Bridgepoint a fifth vertical alongside private equity, credit, infrastructure and secondaries.
Bridgepoint said the acquisition provides it with a US real estate platform spanning equity and debt strategies across sectors such as medical offices, seniors and student housing, multifamily residential and light industrial.
The deal expands recurring fee income and opens up new opportunities for fundraising, product development and platform collaboration, Bridgepoint said.
The latest transaction follows Bridgepoint’s announcement in December 2023 that it had agreed to acquire Nexity’s French residential property management services business for €440m.
Raoul Hughes, CEO of Bridgepoint, said: “This marks another major step forward in our strategy to strengthen our position as a leading global middle-market private markets platform. Real estate is a growing private markets asset class and Kayne Anderson Real Estate has built a leading position as a scaled specialist with an exceptional track record and strong fundraising momentum.
“The transaction is highly complementary and immediately accretive. Bridgepoint’s and Kayne Anderson Real Estate’s investor networks have limited overlap, creating attractive opportunities to broaden relationships and enhance fundraising.
“Adding Kayne Anderson Real Estate creates a more balanced and diversified platform, with around half of our assets under management invested in real assets and around half of our management fees generated in the US.”
Tim Score, chair of Bridgepoint, said: “Kayne Anderson Real Estate is a high-quality business with an outstanding management team, a strong track record and leading positions in attractive areas of the US real estate market. The board has been highly selective in its approach to strategic acquisitions, and we believe Kayne Anderson Real Estate is an exceptional fit for Bridgepoint.
“The transaction strengthens the quality and diversification of the Bridgepoint Group’s earnings, broadens our capabilities and enhances our long-term growth prospects.”
Al Rabil, co-founder and CEO of Kayne Anderson Real Estate, said: “We are in the beginning of a super cycle for the alternative real estate sectors on which we focus, and joining together with Bridgepoint provides additional global resources to capitalise on this opportunity and support our continued growth.
“Importantly, this partnership allows us to preserve our culture and investment approach while continuing to manage the business as we always have.”
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