Firm of the Year
2 Global Logistic Properties
3 Orion Capital Partners
Another Blackstone year was marked by records. In 2017, the firm sold its Logicor logistics platform to Chinese sovereign wealth fund CIC for a world sector record of €12.25 billion, a transaction that won it PERE’s Europe Deal of the Year. In a capital haul superlative, Blackstone broke the European fundraising record with €7.8 billion final closing for its fifth European opportunistic vehicle, also a PERE award winner.
Blackstone, whose Europe real estate division is chaired by Anthony Myers, also staked a major claim in European core-plus territory, launching a core-plus fund that attracted $2 billion in a first close. In addition to raising capital, Blackstone put no shortage of money to work last year. The firm used €1.2 billion of BREP V equity to fund a €5 billion purchase of the property portfolio of Santander-owned Banco Popular, giving Blackstone a 51 percent stake in a company that holds the bank’s real estate assets and non-performing loans. In other European deals, Blackstone took Finnish property company Sponda private in a €3.8 billion deal inked in June.
Industry Figure of the Year
1 Nick Weber, Henderson Park
2 Anthony Meyers, Blackstone
3 Isabelle Scemama, AXA IM
Nick Weber has a capital raising and deploying track record most established managers would envy. His background, track record and deep investor relationships drove the launch of London-based Henderson Park in July 2016 with $500 million in seed equity, pledged by Greenwich, Connecticut-based private equity firm Stone Point Capital, sovereign wealth fund Kuwait Investment Authority, and New York and Kuwait–based investment manager Wafra Investment Advisory Group. Fast forward to October 2017, and the firm had raised $950 million in a first close for its debut fund Henderson Park Real Estate Fund I, likewise with Mount Kellett investor support.
Weber oversaw plenty of capital deployment, too, with notable deals in multifamily and hospitality, including the December purchase of the Westin Paris-Vendôme for €550 million. Just 18 months after launching Henderson Park, Weber proved 2017 to be a strong year for establishing his, and Henderson Park’s name across Europe.
Deal of the Year
1 Blackstone’s sale of Logicor to CIC
2 Global Logistic Properties’ purchase of Gazeley
3 Patron Capital’s purchase of Punch Taverns and JV with Heineken
Blackstone had been looking to either sell Logicor privately or take it public since at least May 2016, and in June the firm announced it had found a buyer for a record-setting transaction in sovereign wealth fund China Investment Corporation. At €12.25 billion, the deal was not only a property-specific record, but registered among the largest deals since the global financial crisis.
Logicor owns and operates a portfolio of high-quality rented logistics assets totaling 147 million square feet in 17 countries, with over 70 percent concentrated in the UK, Germany, France and southern Europe. Blackstone built Logicor using capital from two European opportunistic vehicles, Blackstone Real Estate Partners Europe III and IV, and a global opportunistic fund, BREP VII. The Logicor exit eclipsed Blackstone’s 2014 sale of its US logistics business, IndCor Properties, to Singaporean sovereign wealth fund GIC Private for $8.1 billion. Through the deal, CIC not only gained a major industrial foothold in Europe, but it also set a record for the property type, one that is unlikely to be beat anytime soon.
Institutional Investor of the Year
CIC set itself up for a major 2017 expansion, which it partially accomplished through its record-setting purchase of Logicor. In April 2016, the sovereign wealth fund underlined its appetite for a greater push into private real estate investment with the creation of a dedicated department and the doubling of its allocation to the asset class.
With Logicor, CIC gained a strategic European foothold in the increasingly competitive logistics market. With an existing portfolio spanning office, retail and residential investments, the addition of 147 million square feet of industrial properties firmly established CIC as one of the largest players in European logistics.
The deal saw CIC adding 630 assets to its Europe portfolio, with tenants including e-commerce giant Amazon. CIC had tough competition in bidding for the mega-logistics platform; another major bidder was reported to be Singaporean sovereign wealth fund Temasek Holdings and its real estate arm, Mapletree Investments.
Capital Raise of the Year
1 BREP Europe V
2 Kildare European Partners II
3 Orion European Real Estate Fund V
Blackstone smashed its own European fundraising record when it closed Blackstone Real Estate Partners Europe V in June on its €7.8 billion hard-cap. The firm, whose Europe real estate team is led by James Seppala, launched the vehicle in November 2015 with a target of €7 billion.
Just three years earlier, Blackstone raised €6.7 billion for the then-largest Europe fund, BREP Europe IV, which closed in March 2014 and is now the second-largest Europe vehicle, generating a 14 percent internal rate of return and a 1.4x multiple, as of December 31. Blackstone is targeting a 15 percent net IRR and a 1.7x net multiple for BREP Europe V. According to an investor document, the firm plans to invest 60 percent of the fifth fund’s capital into the core European markets of the UK, Germany and France, and will also pursue distressed assets in Ireland, Italy and Spain. When it closed in June, the fund was already 20 percent deployed or committed.
Capital Advisory Firm of the Year
2 Macquarie Capital
3 Park Hill
Financial advisory and asset management firm Lazard prevailed as the favored Europe Capital advisor for a fifth consecutive year, with more than half the votes cast for the category. Work on Henderson Park’s seed funding helped secure its first-place rank, and that relationship proved fruitful again in 2017. The placement agent advised the firm on raising $950 million just in the first closing for its maiden vehicle.
Lazard also had a hand in helping Paloma Capital close its debut fund, with £140 million ($193 million; €158 million) corralled for the UK logistics vehicle. The fund’s 21 investors included large corporate and state pension funds, fund of funds, endowments, family offices and high net worth individuals.
Lazard’s work extended to Greece, where the firm acted as the placement agent for Athens-based Bluehouse Capital’s fourth Central and Eastern Europe fund. The vehicle closed on €150 million. With a varied mandate set, all eyes are on Lazard to defend its title for the sixth year running in 2018.
Firm of the Year: UK
1 Henderson Park
2 Tristan Capital Partners
3 CBRE Global Investors Partners
Henderson Park did not enter the real estate market 18 months ago with small ambitions, and its multiple PERE awards before the first fund held a final close show the results of those big plans. In 2017, the London-based firm invested £500 million ($692 million; €564 million) into two of the UK’s largest hotels, the London and Birmingham Hilton Metropoles, and put £100 million into buying the Athene House office in London’s Midtown.
On the residential side, the firm inked joint venture initiatives with leading global real estate firms, including one with Greystar Real Estate Partners for the acquisition of a 172-unit central London residential portfolio for £140.5 million for designation to the private rental sector. Henderson Park also teamed up with Hines to buy a 630-bed student accommodation development in Lancaster. The firm is understood to be seeking further UK residential investment opportunities with these partners, leading PERE to anticipate more than a few deal announcements to come in 2018.
Firm of the Year: Germany
1 Ares Management
2 Patrizia Immobilien
3 AEW Europe
Los Angeles-based Ares Management beat Patrizia Immobilien for Firm of the Year on Patrizia’s home turf. The winner’s banner year was summed up by its deal volume: the firm transacted more than €1 billion of deals across property types in the country. Headline acquisitions included the Nova Eventis shopping center near Leipzig, portfolios of value-added office buildings located across top markets and the Zehlendorfer Welle mixed-use building known as ‘The Wave’ in an affluent Berlin district.
On the dispositions side, Ares sold the Kustermann Park office complex to a pan-European fund manager. Ares bought the 800,000-square-foot office in Munich in October 2015 and repositioned it, upgrading external and common areas, selling the property at a 3 percent vacancy rate. The firm also exited a 2,500-unit multifamily residential portfolio in north and west Germany for €130 million.
Led by Bill Benjamin, Ares has been active in German real estate for two decades. After a high-octane 2017, expect more headlines in the year to come.
Firm of the Year: France
1 LaSalle Investment Management
2 Lone Star Funds
3 La Francaise Real Estate Managers
Last year alone saw Chicago-based LaSalle Investment Management investing more than €700 million in core, core-plus and value-added strategies. In November, the firm inked its largest continental Europe deal, paying €291 million to buy Place des Halles, a 120-store retail center in Strasbourg, France. LaSalle made the acquisition on behalf of a separate account and through its Encore+ fund, for which Aviva Investors is the fund manager but LaSalle is the asset manager.
In central Paris, LaSalle bought 25 Clichy, a 50,000-square-foot office, through its pan-European office fund, and purchased the Europa building, a 285,000-square-foot office, in the Levallois business district. The firm also agreed to acquire the ‘Infinite’ building on the Rue Bayard in Paris’s central business district, previously home to a radio station. In two years, LaSalle’s French business, overseen by continental Europe head Karim Habra, doubled its assets under management to €3.5 billion, and PERE expects the firm to notch more than a few deals in the year to come.
Firm of the Year: Nordics
2 CapMan Real Estate
Bülow-Lehnsby: NREP co-founder
The Nordics-focused manager led by Mikkel Bülow-Lehnsby has occupied this winning spot since 2014 and shows no signs of ceding its place. In 2017, the firm expanded both its assets under management – up 20 percent, to €4 billion – and its head count, adding 27 professionals for a total team of 110 people, the largest private equity real estate team in the region.
Other highlights included forming the largest Nordics logistics platform, the NREP Logistic Properties Fund, which had a seeded, 49-asset portfolio with a gross asset value over €1 billion. NREP’s investments over the year across its products totaled €1.6 billion and new equity reached €1.4 billion.
On the dispositions side, NREP exited three retail portfolios, including the largest Swedish retail portfolio deal of the year, for a combined €350 million. With the company boasting a 20 percent-plus internal rate of return since its 2005 founding, any firm seeking to unseat NREP for its fifth title in 2018 faces an uphill battle.
Firm of the Year: Spain
1 AXA IM
2 Ares Management
3 Meridia Capital
A familiar name topped this new category in 2017. AXA Investment Managers – Real Assets clinched the Spanish win with an active investing year across property types. Its activities included a joint venture that saw AXA and two partners, Greystar Real Estate Partners and CBRE Global Investment Partners, acquire more than 9,000 student beds across 33 assets through the purchase of Spanish student housing company Resa.
The JV marked Spain’s largest student accommodation portfolio deal. AXA also purchased the Area Sur Shopping Center in Jerez for more than €100 million in June on behalf of its open-ended core European fund. As of purchase, the 500,000-square-foot mall was 90 percent leased to 86 tenants. AXA inked another June deal to buy a 55 percent stake in the 430-room Hilton Diagonal Mar in central Barcelona for €80 million. The firm closed out the year with the acquisition of a 28-building, 850-unit residential portfolio in Madrid and Barcelona for €170 million.
Firm of the Year: Italy
3 Fortress Investment Group
Ardian made its Italy debut in February with the €300 million acquisition of a six-asset office portfolio. The Paris-based firm, which manages $60 billion in capital, bought the portfolio from fund manager Prelios. Two of the six assets are located in Milan and two are in Rome, while a much smaller sixth property in Bari. The six properties comprise a combined 915,000 square feet. Ardian bought the portfolio through Ardian Real Estate Europe Fund.
Ardian’s core-plus real estate investment strategy targets markets in Italy, France and Germany where the firm has experience in direct private investments and is able to enhance rental income through active asset management. The firm launched its real estate arm in 2015, led by French real estate veteran Bertrand Julien-Laferrière, with the goal of €2 billion in assets under management by 2020.
Law Firm of the Year: Fund Formation
1 Clifford Chance
2 Goodwin Procter
3 Paul Hastings
Clifford Chance has left little room for competition in this category for more than a decade, with 2017 marking the firm’s 11th straight win – a track record unsurpassed by any group in any category. The London-based law firm’s 2017 highlights included a strong focus on debt vehicles, mirroring the interest in private equity real estate fundraising globally.
Clifford Chance’s mandates included advising ICG-Longbow on two funds: the formation of ICG-Longbow Senior Debt Programme, Vintage IV, a £500 million ($704 million; €563 million)platform investing in UK-domiciled senior real estate debt opportunities; and UK Real Estate Debt Investments V, a mezzanine debt fund targeting £500 million. Partner Gerard Saviola led the ICG-Longbow fund efforts. The law firm’s other work included AXA Investment Managers – Real Assets’ July close of its €1.5 billion 10th vehicle in the CRE Loans SCS-SIF series, overseen by partner Alexandre Lagarrigue. The real estate debt-focused vehicle closed in September with commitments from 19 institutional investors across Europe.
Law Firm of the Year: Transactions
1 Clifford Chance
2 Paul Hastings
Clifford Chance again prevailed as the dual Europe winner, picking up its sixth transactions award in 11 years. Paul Hastings, the 2015 winner, again proved the law firm’s toughest competition. But given Clifford Chance’s hand in some of Europe’s bigger transactions with the continent’s biggest names, it is little surprise the firm again came out on top.
In one highlight, the law firm advised Patron Capital in its purchase of Punch Taverns, overseen by partners David Pearson and Lee Coney. Patron bought the company, valued at £1.8 billion ($2.5 billion; €2 billion), before selling part of the business to Dutch beer company Heineken. The firm also advised Parkdean Resorts, which managed 73 caravan holiday parks across England, Scotland and Wales, on its sale to Onex. The £1.35 billion deal closed in the first quarter of 2017. The firm rounded out its non-traditional real estate focus by advising Blackstone on the purchase of The Office Group, which manages 36 serviced office buildings across central London. Partner Spencer Baylin worked on that deal.
Firm of the Year: Africa
2 RMB Westport
3 Grit Real Estate Income Group
Another repeat winner, Actis has once again landed PERE’s Africa Firm of the Year title. However, while last year’s victory focused on fundraising, this year’s was more about deployment. Most notable was the firm re-entering two markets, Cameroon and Ivory Coast, after 30 years away.
In both cases, the projects are mixed-used developments that will be constructed by operating partner Improven Group. Renaissance Plaza in Abidjan and Douala Grand Mall in Doualaw are both intended to offer office and retail space to existing and new occupiers. They underscore the firm’s appetite for greater exposure to French-speaking markets in the continent.
Announcing the commitments, Amanda Jean-Baptiste, partner and head of West Africa, Real Estate at Actis said: “The demand for quality real estate in Cameroon and Cote d’Ivoire has been largely ignored by international investors for too long.”
PERE’s readers evidently agreed.