Chart of the Week: Percentage of Global Capital Raised

Global fundraising takes a bigger chunk of total capital each year

 COW 10-29 411x 

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While most funds have a specific region to target its investments, a growing amount of funds have decided on a more global outreach to invest. Data from PERE Research & Analytics has revealed that global fundraising has regained traction in total percentage of capital raised between 2008 and 2013, as well as going into 2014. Due to the ripple effect of the financial crisis in 2008, fundraising had faced its lowest point in 2009, where a total of $14.9 billion had been raised or about 22 percent. However, since its lowest point, global fundraising had taken a larger chunk of total capital raised each year, with 2013 raising $32 billion or 27 percent. 

In terms of strategy, both debt and opportunistic fundraising have led global funds in the previous years, with debt being in the lead in YTD 2014, raising a total of $12.9 billion or 69 percent. The largest debt fund to close for global fundraising in YTD 2014 was the Lone Star Fund IX, managed by Lone Star Funds, which raised $7.4 billion in August. Additionally, it is the largest fund to close so far in 2014. While fundraising for global funds had increased each year since 2009, 2014 may not reach the same milestone. At the end of Q3 2014, a total of $83.6 billion had been raised with global funds taking about 22 percent of the total or $18.6 billion. At the same time last year, global fundraising had collected $21.5 billion, a decrease of 13 percent. However, fundraising may pick up for global funds by the end of the year. Recently, the Starwood Distressed Opportunity Fund X, managed by Starwood Capital Group, held an interim close of $4.2 billion towards a $5 billion target. The fund, which has a global mandate, is expected to close by the end of the year. 

Other notable global funds in market include the Morgan Stanley Real Estate Fund VIII Global, managed by Morgan Stanley Real Estate Investing, which is targeting $3 billion; the Oaktree Real Estate Opportunities Fund VII, managed by Oaktree Capital Management, which is targeting $3 billion and; the TPG Real Estate II, managed by TPG, which is targeting $2 billion.