BlackRock has raised €774 mln in initial investor commitments at the first close of its latest European value-add fund and is to embark on a major spending spree as it believes cyclical factors are creating the best real estate buying opportunity since the global financial crisis.
The fund - BlackRock Europe Property Fund VI - will target the most liquid markets in Europe, with a focus on the UK, France, Germany, the Nordics and Spain; and invest in high-quality assets aligned with the structural “mega forces” driving the economy and future occupier demand. These mega forces include demographic shifts, digital disruption and the transition to a low-carbon economy and a net zero built environment.
'We are delighted to partner with our clients, many of whom have committed to prior EF vintages. Cyclical and structural factors are creating what we believe is the best real estate buying opportunity since 2008,' commented Thomas Mueller-Borja, Global CIO of Value-Add Real Estate and Co-Portfolio manager of EFVI. 'It is crucial to remain disciplined and selective in more volatile times, and we continue to apply the research-led, principle-based investment approach which has consistently guided our decision-making over the years.'
The Fund will focus on the need to develop student housing and new residential units, and to provide business-critical logistics and data centre premises in under-supplied markets. As an SFDR Article 8 fund, EFVI aims to create future-proof assets with strong ESG credentials, including high-energy efficiency and pathways to net-zero emissions.
Business plans will focus on recapitalising, repositioning, and rebuilding assets with the BlackRock teams using a hands-on approach to deliver value throughout the life cycle of each investment.
To date, EFVI has already committed €289 mln of equity across four investments: two logistics assets in Sweden, and multi-family assets and student housing in the UK.
Anne Valentine Andrews, global head of Real Estate & Infrastructure at BlackRock added: 'The European Value-Add series is a vital component of our $28 bn global private equity real estate business. Despite continued market uncertainty, the window of opportunity is opening for real estate investors. This requires getting granular within asset classes and harnessing the structural mega forces driving future demand and requirements for real estate. We are pleased to partner with our clients in this latest vintage, delivering local market knowledge and personalized service from BlackRock.'
