Leon Black’s Apollo Global Management is looking to move back into the real estate sphere with ambitions to rival the likes of Morgan Stanley and The Blackstone Group, according to sources close to the firm with direct knowledge of the plans.
Apollo Global Management, the new name of the parent organization for New York-based alternative investment firm Apollo Management, has approached at least one senior real estate professionals at a seperate firm to lead the operation, PERE was told.
A spokesman for Apollo Global declined to comment.
A source briefed on Apollo Global's plans suggested the firm would attempt to brand its real estate arm with the Apollo moniker, despite the existence of a seperate, prominent New York private equity real estate firm called Apollo Real Estate Advisors, in which Black and other Apollo Global executives have a minority stake.
Apollo Real Estate was established in 1993 by William Mack in conjunction with Apollo Management to take advantage of distress in the real estate market.
The two firms no longer have any official affiliation, according to Apollo Global's recent filings with the US Securities and Exchange Commission.
According to the filing, completed as Apollo Global attempts to list shares on the New York Stock Exchange, the firm’s managing partners initially managed Apollo Real Estate funds and exerted some managerial control.
However, according to the filing, Apollo Global's managing partners no longer manage Apollo Real Estate funds, nor does the firm “continue to exert any managerial control although our managing partners continue to have minority interests in such entities, including their general partners and management companies. . .”
It is unclear what branding changes will take place at Apollo Real Estate is an Apollo Global real estate arm is established with a similar name.
Bill Mack and Apollo Real Estate partner Lee Neibart, who has been with the firm since its inception, have also founded private equity real estate, NRDC Equity Partners, together with former National Realty & Development Corporation executives Richard Baker and Robert Baker. This week the firm announced it had acquired Canada’s largest retailer Hudson Bay Company, after previously holding a minority stake. The firm plans to consolidate the retailer with its previous acquisitions, including the upscale retail chain Lord & Taylor.
A spokeswoman for Apollo Real Estate declined to comment. NRDC was unavailable for comment.
A source told PERE magazine that Black has ambitions to grow a private equity real estate arm to a scale where it would be in competition with the largest such firms, including The Blackstone Group and Morgan Stanley Real Estate, currently numbers one and two, respectively, on the PERE 30, PERE magazine's ranking of private equity real estate by size. Apollo Real Estate is 14th.