Ares Management is expecting to launch its next opportunistic European flagship fund, Ares European Real Estate Fund V, in the second half of the year.
The Los Angeles-headquartered company has surpassed the 75%-invested threshold for its $1.3 bn Europe Fund IV, and is planning to market the sequel before the end of the year, EuroProperty, the weekly PropertyEU bulletin, has learned.
While no decision has yet been taken regarding size, the strategy will remain the same as the current fund by targeting investments in residential, retail, office and industrial real estate in larger European markets including the UK, Germany, and France.
Ares’ European Real Estate Fund IV proved a hit with investors last time around: it easily surpassed a $1 bn (€0.9 bn) target, finally closing on $1.3 bn in January 2015. Investors included Pennsylvania Public School Employees’ Retirement System, who in a 2014 investment document noted the European team had been investing in Europe since 1995 and that it had managed a 19.5% gross Internal Rate of Return and a 1.7x gross equity multiple in its core European markets.
The news comes after Ares closed its European value add property fund, Ares European Property Enhancement Partners II, on €665 mln in September 2016. Meanwhile in the US it launched its latest value-add fund earlier this year for which it reportedly held a $415 mln first close last month.
Ares' Real Estate Group has $9.9 bn of real estate assets in public, private equity and debt strategies in the US and Europe and employs around 75 investment professionals. It is headed by Bill Benjamin, based in London.
