Closed-ended private real estate funds have a record $220bn (€176bn) of capital to invest, according to Preqin.
The figure is up from the $186bn registered in December last year.
Preqin said most of the capital is accounted for by North America-focused funds, with $113bn focused on the region.
Europe-focused funds have $66bn of equity, while Asia-focused funds and funds focusing outside of these three regions having $32bn and $9bn in uncalled capital, respectively.
“The increase in uncalled capital available to private real estate fund managers is a result of strong fundraising over the last two years,” Preqin said.
In the third quarter of this year, 28 real estate funds closed, securing an aggregate $17bn and bringing the 2014-to-date figure to $62bn.
The amount compares with $57bn raised in the same period last year. Preqin said fundraising for this year is likely to be strong again.
Distressed funds raised the largest amount of capital compared with any other strategy, with $7.3bn secured by two funds.
Seven opportunistic funds held a final close and raised $2.5bn. Lone Star’s Fund IX was the largest fund to close in Q3, securing $7.2bn for global opportunities.
Preqin noted an increase in larger funds – being raised by fewer managers. The average size of real estate funds closed so far this year stands at $546m, the highest figure ever for a single year.
“There have been several consecutive quarters of strong fundraising, reflecting growing institutional investor appetite for real estate funds,” said head of real assets products, Andrew Moylan.
“With a wall of capital chasing deals and pricing increasing, they will have to work hard to find value in an increasingly competitive marketplace.”
