L&G has acquired a 75% stake in Proprium Capital Partners, a global real estate private equity firm with $3.5bn (€2.6bn) in assets under management (AUM).
Financial details were not disclosed, but L&G said, as part of the acquisition, it would commit up to $300m of capital to support Proprium’s future fund strategies.
Founded in 2013, Proprium is a spin-out of Morgan Stanley’s real estate special situations team. Proprium is active across residential, student accommodation, hospitality, and logistics sectors, with past investments including stakes in Motel One.
L&G added that with around 60% of Proprium’s portfolio in Europe and a market presence in APAC, it will “benefit from its track record to accelerate its ambitions in these regions”.
As part of the acquisition, Proprium’s management team will continue to operate independently, maintaining its current leadership structure, teams and investment process, all of which will be enhanced by working as part of the wider L&G private markets platform, the manager added.
Eric Adler, CEO, asset management, L&G said: “Recognising that international scale in private markets is key to delivering against L&G’s growth strategy, this strategic investment in Proprium will expand our geographical footprint, deepen our capabilities, broaden our investment strategies, and diversify our product offering.
“Through this acquisition, we are bringing clients a differentiated and diversified opportunity to access value creation in real estate sectors positioned for growth and scalability.”
Bill Hughes, global head of private markets at L&G added: “In the last 12 months we have significantly accelerated the growth of our private markets platform, laying the foundations for achieving our ambitious target of £85bn AUM by 2028.
“The partnership with Proprium will strengthen L&G’s investment capabilities and broaden our product offering, allowing us to bring a select range of strategies that aim to deliver the higher returns that many global investors are seeking.”
Tim Morris and Philipp Westermann, co-managing partners of Proprium Capital Partners, said: “[This transaction] is a testament to the strength of Proprium’s track record in delivering strong, risk-adjusted returns for investors.
“On behalf of the Proprium team, we are incredibly excited about the partnership with L&G, their financial backing and growth ambitions. Their investment opens new doors to international markets as L&G builds out its global real estate business, representing a significant milestone in the evolution of our platform at a time of immense opportunity.”
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