REAL ESTATE - Cash-rich US pension funds are driving a move by real estate funds into European markets.
RREEF’s Real Estate Opportunities Funds Group has raised $1.6bn in the final closing of a fund designed to US institutional investors exposure outside the faltering domestic real estate market.
The Real Estate Opportunities Fund II will invest opportunistically in property and "real estate-related assets", including REITs and joint ventures. In developed markets, where remaining investment opportunities are scarce, the fund will acquire operating companies. In emerging European and Asian markets, its primary focus will be on large portfolios divested by governments and corporates, hospitality, redevelopment opportunities, residential and retail.
RREEF forecasts that Europe will account for around 50% of acquisitions. Around 30% will be invested in Asia and 20% in the US.
More than 90% of investors in the fund are US institutions looking to invest outside traditional European markets.
In a separate development, Perella Weinberg hired former Leon Bressler to head its London-based real estate fund – a joint venture with New York-based Fisher Brothers.
Spokeswoman Gina Sorice said: "When the firm set up in June, they had a great track record on the advisory side. If there was a question, it was on the asset management side. This is an auspicious hiring."
The real estate joint venture will be the first of several sector-specific funds. "Joint ventures could be an opportunity to explore," she said.
The firm has already raised $1.1bn from a group of 11 unnamed investors. No information was available on how much of this it would commit to the global real estate fund.