Blueprint: Greystar’s $1.9bn Fund XI closing, KKR’s $1.6bn student housing outlay, Tishman Speyer’s continued investment in China

Greystar Equity Partners XI has closed at $1.9 billion, smaller in size than its predecessor by $100 million; Coima SGR's latest investment in Italy's office market is part of a bank's strategy to downsize its real estate exposure; and Generali Real Estate's promotion of its chief executive Alberto Agazzi to a new international position is part of growth plans in the UK, US and Asia-Pacific; and more in today's briefing, exclusively for our valued subscribers.

They said it

Nathalie Palladitcheff (Photo source: Ivanhoé Cambridge)

“Some GPs have lost their promote now, so where’s the motivation to make money?”

Ivanhoé Cambridge outgoing CEO Nathalie Palladitcheff speaking to PERE about misalignment between LPs and GPs in the context of a private real estate market losing value

What’s new

Unfounded optimism

South Carolina-based Greystar Real Estate Partners closed Greystar Equity Partners XI with $1.9 billion in capital commitments, PERE revealed this week. The US multifamily-focused fund is the third-largest private real estate vehicle globally to close so far this year, PERE data shows, and the largest sector-specific fundraise in the period. Despite the success of Greystar’s flagship value-add series, which has attracted more than $6.5 billion since its inception in 2011, GEP XI failed to match its predecessor in size, missing GEP X’s total by $100 million. Reflecting the challenges of raising capital from investors during an ongoing period of severely limited distributions from real estate investments, GEP XI, which was launched in May 2022, fell short of its $3 billion target size by more than $1 billion. However, comparing two separate filings with the Securities and Exchange Commission around a year apart indicates the firm had raised the fund’s target from $2.5 billion at some point before May last year. Taken together with PERE’s subdued fundraising figures for Q1, such ultimately unfounded optimism indicates a recovery to pre-rate-hike capital raising volumes is not in the cards for private real estate in 2024.

KKR bunks down in the US

Student housing continues to be an in-demand asset, with KKR dropping $1.64 billion on 19 student housing assets across the US. The portfolio spans some 10,000 beds in 10 states, anchored by 14 public universities. Blackstone Real Estate Income Trust is the seller, KKR said in an announcement on the deal, having acquired the portfolio back in 2018 in a joint venture with Greystar Real Estate Partners. KKR has “long-term conviction” on student housing, Justin Pattner, Partner at KKR and head of real estate equity in the Americas, said in the statement.

Through BREIT’s American Campus Communities, Blackstone remains the biggest owner of student housing in the states, even after the sale – with the firm continuing to grow the platform, according to Jacob Werner, Blackstone’s co-head of Americas acquisitions.

Banking on dealflow

Over in Italy, Milan-based manager and developer Coima SGR is set to purchase a €500 million portfolio of offices from the country’s largest bank, Intesa Sanpaolo, as it downsizes its real estate footprint in the country. As part of the transaction, the bank will receive ownership shares of less than 50 percent in each of the Coima vehicles into which the assets are transferred. Coima will redevelop the properties, three of which are prime offices in Rome and Milan, with the majority of the portfolio repositioned into alternative uses such as residential or hospitality, according to chief executive officer Manfredi Catella. This collaboration between the manager and the bank was “several years” in the making, said Catella, and could lead to further transactions, initiatives or capital raising activities between the two. In fact, he hopes the co-operation with Intesa will trigger new partnerships with other Italian institutions. “We want to start joining forces with relevant institutions across the country to support the transition in real estate – and not just the green transition,” he told PERE. Read more in our coverage here.

Trending topics

Points of collapse 

Killed deals and properties yanked from the market are on the rise in Europe, suggesting there is still a lack of clarity about the outlook for real estate currently. In the first quarter of the year, the number of terminated deals and properties removed from sale reached a post-global financial crisis high in Europe, per MSCI Europe data published last week. In all, the number of deals worth more than €5 million terminated and for-sale properties withdrawn from the market in the quarter spiked to 110, per Reuters, the highest since 2010. Among these were the sales of 20 Old Bailey and 5 Churchill Place in Canary Wharf in London, which both fell apart in the first three months of the year, per reports in the Financial Times.

Never stop searching in China

Despite many of its peers shying from the country because of geopolitical issues with the West, New York-based manager Tishman Speyer remains committed to chasing opportunities in China. Last week, the firm completed the purchase of a 20-story hotel in Shanghai from Hong Kong-listed company EverChina International Holdings for 360 million yuan ($49.7 million; €46.4 million), according to a filing. The firm plans to convert the hotel into 300 rental apartments in what would become its first multifamily project in the city.

The development is close to the Springs, a mixed land-use campus developed by Tishman Speyer. Wilson Chen, chief executive officer of Tishman Speyer China, said the multifamily project presented “an attractive opportunity to diversify our Shanghai portfolio.” Aside from Shanghai, the real estate company also teamed up with Frasers Hospitality in 2023 to acquire a 325-unit set of rental apartments in Shenzhen’s Luohu district, according to Asia real estate news service Mingtiandi.

Calling all women of influence 

PEI Group’s fourth Women of Influence in Private Markets list is now open for nominations. We are looking for professionals working at managers, investors and advisory firms that cover a range of private markets including real estate. Previous winners include Nancy Lashine, founder and managing partner of placement agent Park Madison Partners; Chiang Ling Ng, chief investment officer for Asia at Hines; and Artemis Real Estate Partners co-founder and co-CEO Deborah Harmon. Please note individuals who have appeared in PEI Group’s 2021, 2022 or 2023 Women of Influence in Private Markets lists will not be eligible. Click here for the full list of criteria considered and to submit your nomination. Please make your nominations is by the end of the day Friday, May 24.

Data snapshot

Mega-manager pandemic brawn

Investors in private real estate mega-fund with vintages active during the pandemic benefited from median average internal rates of return of 11.51 percent and total value-to-fund capital of 1.24x. Notably, most of the 14 qualifying funds benchmarked in PERE’s performance data benefited from middle- to upper-quartile IRRs, with just two vehicles in the lower quartile.

Mega fund ($5bn-plus) performance 2016-21 (IRR, %)   

Source: PERE

People

Generali’s double promotion

After nearly a decade as chief executive of Generali Real Estate, Alberto Agazzi has been promoted to the new position of head of Generali Real Estate International, focused on driving the organization’s growth in the UK, US and Asia-Pacific. Agazzi, who joined Generali in 2006 and became CEO in 2015, will be charged with setting and executing business development plans for the Italian insurer’s real estate business in key markets outside of continental Europe. Succeeding Agazzi as CEO is Nunzio Laurenziello, who joined Generali in 2018 and previously was head of European debt investments. Read more about him here.

Generali sits in tenth place on the PERE Global Investor 100 ranking of the world’s largest real estate investors. It operates in nine European countries across regional platforms in Southern Europe, Western Europe, Central and Northern Europe and Central Eastern Europe and Nordics, as well as a logistics platform and an office and retail business called CityLife. Generali Real Estate has exposure to the US through its parent organization’s acquisition of investment manager Conning and its real estate subsidiary Pearlmark, and invests in APAC through its fund of funds platform.

Investor watch

A niche in the traditional

New Mexico State Investment Council is considering a total of $500 million commitment across three real estate funds, according to its latest meeting minutes. These include $300 million to Carlyle Realty Partners X, $100 million to Jadian Capital’s Jadian Real Estate Fund II, and $100 million to Westport Capital’s cold storage fund WCP NewCold III. Among the managers of these vehicles, the investor only has an existing relationship with Carlyle – where it previously invested in CRP VIII, CRP IX, and its core-plus open-end fund Carlyle Property Investors. For the other two new relationships, the investor is looking to diversify its real estate portfolio by targeting growing niche segments as self-storage, cold storage and industrial outdoor storage.

This week’s investor meetings

Tuesday, April 30

Wednesday, May 1

Thursday, May 2

Friday, May 3


Today’s letter was prepared by Miriam Hall, with Evelyn Lee, Jonathan Brasse, Charlotte D’Souza, Christie Ou and Samantha Rowan contributing.