Spain’s Azora Real Estate has attracted major capital from an unnamed sovereign wealth fund for a multi asset strategy.
The vehicle is structured as having an investment period of five to ten years, underlining how some managers and investors in this climate do agree to longer term investment timelines than the traditonal three-years for private equity vehicles. For some time now, fund sponsors have been introducing longer dated funds and have introduced open ended and hybrid investment vehicles to the prooduct mix.
The firm described that concept as targeting a broad range of opportunities across the entire real estate sector, with a primary focus on Southern Europe. For some time now, firms have been adding longer duration vehicles to their product mix, including semi open ended funds and hybrids.
Azora also said the vehicle would have €500 mln of acquisition firepower, suggestive of a blended 46% debt financing percentage.
It said the new vehicle can take on all risk levels from development to those requiring lower levels of repositioning, as well as opportunities arising out of the uncertain current market environment. These might include those in the traditional segments of offices, logistics and retail, as well as in other newer and emerging sectors such as residential asset classes (build to rent, co-living, student and other alternative housing models), as well as data centres, agriculture and leisure, amongst others.
Azora will deploy an 11-strong team of multi-strategy professionals to manage the mandate.
This is the third dedicated multi-sector strategy Azora has launched in Europe, the first being the €1.1 bn Hispania SOCIMI, which it launched in 2014 and sold to Blackstone in 2018 to realise a IRR of 19%. Subsequently, Azora created a fund using capital from its own balance sheet and Azora’s principals, which is now fully invested and has already generated an average return of 23% on divestments to date.
Javier Rodríguez Heredia, managing partner of Azora's Real Estate Area, said: ‘New trends in the way we live, work, and play will require a major transformation in how assets are used, designed and adapted to meet current and future environment standards.’
