EXCLUSIVE: Church Pension backs Revetas Capital

The New York-based pension fund has made a significant commitment to the second Fund of the central European real estate specialist which has held a second close above €100 million and made its first acquisition from the fund.

Revetas Capital, a specialist real estate investor focused on central European economies, has held a second close for its latest fund after backing from Church Pension Group, PERE has learned.

Revetas has also partnered with alternatives investment fund manager York Capital Management to buy a €150 million pan-central European real estate portfolio.

The firm held the close for Revetas Capital Fund II, which launched towards the end of last year, above the €100 million mark.

Revetas is targeting €200 million for the fund. Sources indicated that all of the limited partners in its first fund have re-upped for Revetas Capital Fund II. Fund II is a follow-on to Revetas Capital Recovery Fund I, which was focused on over-leveraged, distressed and under-performing property opportunities across central Europe.

The core central European countries Revetas Capital is targeting remain the same as in Fund I, including Poland, Czech Republic, Slovakia and Hungary. However, the investment strategy is no longer simply focussed on 'distressed' situations, with Revetas Capital now also pursuing income-producing assets held in capital structures that sponsors wish to exit.

Church Pension Group is not the only US-based investor to see value in Europe's eastern economies in recent months. At the end of August 2015, TPG Real Estate, the real estate platform of global private investment firm TPG, agreed to purchase Budapest-headquartered TriGranit, one of Europe's largest privately-owned developers and managers of retail and office assets.

JP Morgan, Lone Star and Oaktree Capital Management are also said to be purchasing major loan books totalling roughly €3.1 billion backed by commercial real estate in the region.

Revetas has recently completed the first transaction of Fund II by partnering with York Capital Management to acquire a portfolio of four properties for approximately €150 million. The portfolio covers around 1 million square feet across four different cities in Poland, Czech Republic and Slovenia.

The seller is rumoured to be Pramerica Real Estate Investors, the real estate investment management arm of Prudential Financial.

Church Pension Group has close to $12 billion of assets under management and had a 12 percent allocation to real estate as at March 31, 2015.

Founded in 1991, York Capital Management is a global alternative investment firm. York Capital currently has around $25 billion in assets under management, with 200 employees and offices in New York, London and Hong Kong.