Data from PERE Research & Analytics reveals that, between 2008 and 2014, 575 value-add funds raised a total of $174.21 billion. Fundraising for the strategy grew fairly consistently throughout the years and peaked post crisis in 2014 when a total of $29.4 billion was raised. This represents a growth of 38 percent from the prior year when a total of $21.3 billion was raised in 2013 and 88 percent from the lowest point in 2009. One important trend in recent years is that more capital is being raised through less funds. In 2014, the average value-added fund raised $426 million while in 2012 and 2013, the average fund raised $256 million and $266 million respectively. Additionally, more mega funds have closed for the strategy in recent years, which helps explains the uptick in both total capital raised and average fund size. In both 2013 and 2014, six funds closed on or above $1 billion while two did so in 2012, and four in 2011. The largest fund to close for the strategy in 2014 was the Wessal Capital joint venture, which raised €2.5 billion to invest in tourism infrastructure.
In terms of geography, North America led all other regions for the strategy, raising an aggregate size of $14.6 billion in 2014, or approximately 50 percent of value added fundraising for the year. Despite strong fundraising figures, North American value-added fundraising did not reach the same levels as 2013’s when the strategy raised a total of $16.3 billion, a decrease of 11 percent. However, 2014 did lead in average fund size at $364 million compared to $243 million in 2013. Both the Och-Ziff Real Estate Fund III and the Sheridan Production Partners III led fundraising for North America in 2014, with each fund raising $1.5 billion. Of all regions, Europe showed the greatest uptick in value-added capital raised, with an aggregate size of $8.7 billion in 2014, a growth of 267 percent from 2013. A larger number of funds held a final close in 2014 compared to 2013, with 21 funds closings in 2014 compared to six in 2013.