EQT Real Estate, the property arm of the pan-European EQT Group, has announced the final close of its EQT Real Estate II fund at a hard cap of €1 bn.
According to the firm, demand from both existing and new investors was robust, with commitments into the fund coming from a diversified group of investors across Europe, the Nordics, Asia, North America and the Middle East.
The fundraise exceeded its target size of €750 mln and, at €1 bn, is more than 2.5 times larger than its predecessor fund, EQT Real Estate I. It will seek to make direct and indirect controlling investments in real estate assets, portfolios, operating companies and joint ventures and will target equity investments ranging in size from €40-200 mln.
Robert Rackind, partner and head of EQT Real Estate,said: 'As we are entering a new investment cycle, we see a strong pipeline of attractive value-add investment opportunities that fit EQT Real Estate’s thematic approach to investing primarily into Europe’s key cities, and in particular in our current focus on ‘beds’ and ‘sheds’ assets that are benefitting from positive growth drivers and secular trends.'
Seeking investments that are 'decoupled from the financial cycle', EQT said targets included urban logistics and warehouse assets backed by ecommerce trends, as well as residential investments, including new build for-rent housing, student housing and senior living.
To date, EQT Real Estate II has committed capital into four investment programmes in Sweden, France and the UK, all in line with its social impact strategy. These include the majority control of a publicly-listed company which owns a portfolio of 733,000 m2 of operational logistics assets, comprisiing 124 assets in and around Stockholm and a further 666,000 m2 of consented land for warehouse and house building; plus a portfolio of 28 urban logistics properties located in university cities around Sweden with a pipeline of additional add-on acquisitions.
The fund has also acquired Nest, a residential solutions platform in France with plans to deliver 4,000 purpose-built apartment units for people with physical disabilities; and Saturn, a residential joint venture focused on the delivery of 3,000 new rental homes in affordable parts of Greater London.
The real estate team is also actively evaluating transactions in Germany, Spain, Italy and Benelux, EQT said.
Christian Sinding, CEO and managing partner at EQT, commented: 'Real estate is one of the most exciting growth areas for EQT and the success of this fundraise is a reflection of EQT Real Estate’s ability to source attractive opportunities and then develop sustainable, future-proofed assets, while delivering strong results to its investors. We look forward to continuing to build on that success.'
More than 35% of the commitments were closed after February 2020 during a period of significant global lockdowns, which EQT said underlined both investor appetite and its tech infrastructure, with the latter part of the fundraising process taking place digitally.
