Morgan Stanley announced on Monday that its Alternative Investment Partners (AIP) division raised $370 mln (EUR 275 mln) in commitments for a fund dedicated to acquiring secondary interests in opportunistic and value-added private equity real estate funds.
Morgan Stanley announced on Monday that its Alternative Investment Partners (AIP) division raised $370 mln (EUR 275 mln) in commitments for a fund dedicated to acquiring secondary interests in opportunistic and value-added private equity real estate funds.
The Morgan Stanley AIP Phoenix Global Real Estate Secondaries 2009 LP (Phoenix) initially targeted $250 mln in equity.
'This successful fund-raising effort against a challenging market backdrop is a testament to the strength of our investment team and our differentiated investment strategy and process,' said Jacques Chappuis, head of AIP. 'We believe that demand for comprehensive expertise in real estate investing combined with the team's fiduciary background, direct real estate transactional experience and unique access to a substantial flow of secondaries transactions contributed to the strong response we saw from institutional investors globally.'
Morgan Stanley said Phoenix's objective is to target off-market secondary opportunities in private equity real estate funds that have a sustainable strategy for generating superior returns across real estate cycles, an emphasis on strong real estate fundamentals and in-depth knowledge of local markets.
'For the first time ever, investors in private equity real estate funds are selling significant interests in the secondary market, and as a result, we are finding tremendous opportunities to acquire high-quality assets at attractive valuations,' said Joseph Stecher, head and chief investment officer of AIP Real Estate Fund of Funds.
'We are focusing on best-in-class small- to mid-size fund managers globally as we seek to capitalize on several distinct advantages of investing in the secondary market, including the ability to avoid start-up costs and fees, accelerate investment programmes and shorten time for realization, and effectively value underlying asset portfolios,' he said.