North America awards: Debt rises to the top

The growing popularity of debt strategies was typified by the Capital Raise of the Year award. Los Angeles-based Kayne Anderson’s largest-ever debt fund only just pipped Madison Realty Capital’s fifth signature fundraise, despite two equity offerings from GLP and EQT Exeter also being on the ballot. Kayne Anderson won by 13 votes over its credit-focused peer.

However, it was not the closest race the two firms ran in the region. Madison Realty laid claim to Debt Firm of the Year by a mere two votes over Kayne Anderson in a race that saw all four competitors garner over 20 percent of the vote. Madison Realty raised over half of the capital for its latest fund from new investors, as well as launching Newbond Holdings, a platform focused on hospitality investments, which ultimately put it just over the edge.

Oxford Properties, the Toronto-based investment arm of the Ontario Municipal Employees Retirement System, was rewarded with a win in the Institutional Investor of the Year category, in part because of its debt focus. Specifically, Oxford issued C$600 million ($447 million; €415 million) in green debt financing as part of a wider pivot to debt-focused strategies.

Oxford beat out GIC narrowly in that category, by just 10 votes, despite the Singaporean sovereign wealth fund taking three North American real estate investment trusts private last year, including a $14 billion transaction to acquire STORE Capital with Oak Street. QuadReal – the Vancouver-based investment arm of British Columbia Investment Management Board – and Abu Dhabi Investment Authority rounded out the category.

Plenty of close races…

While debt was a focus and, in some cases, helped decide some votes, 2022 was defined by many extremely close races. Six of the 15 awards saw the top two settled by 2 percent or less. Another three races saw the top two separated by 6 percent or less. By comparison to last year, just one top two in North America was decided by 2 percent or less, with 10 of the 15 being decided by 6 percent or more.

KKR only narrowly saw off Oxford Properties for the Office Investor of the Year award, gaining just 16 more votes. The New York firm’s only award this year was punctuated by its $1.7 billion recapitalization of Drawbridge Realty’s portfolio of Class A office buildings and its involvement in the largest office deal in Atlanta, buying two properties from Invesco and Hines. 

Another tight race saw Boston-based Taurus Investment Holdings usurp PERE awards hall-of-famer Starwood Capital in the ESG Firm of the Year category to win its first-ever award. The newcomer won by two percentage points on the basis of some major partnerships. Taurus completed eight projects focused on decarbonization for a total value over $950 million, including partnering with TPG to build an environmentally-conscious multifamily property in Orlando. The firm also formed a $600 million ESG joint venture with Aegon Asset Management that has already retrofitted a 1981 property with a solar power system.

…But not all

At the other end of the spectrum, a few firms sent a message to the market with landslide victories. The largest margin of any race this year was Evercore’s win in the Capital Advisory Firm of the Year, beating out second place Park Madison Partners by almost 600 votes. Its involvement in Bain Capital’s $3.04 billion raise along with Kayne Anderson and Taurus’ award-winning debt fund and ESG joint ventures ended up being the difference.

Harrison Street ended up running away with Residential Investor of the Year with almost 50 percent of the votes. Second-place Blackstone by comparison had 27 percent. The Chicago-based manager’s broad view of the residential asset class helped it to victory. Harrison Street formed a $1.5 billion joint venture with Core Spaces last year focused on single-family rental, committed $1.4 billion to investment in senior housing and announced its inaugural partnership to provide military housing.

Both Law Firm of the Year categories also saw big wins for Kirkland & Ellis. The Chicago-based firm picked up wins in both Transactions and Fund Formation, gaining 43 and 41 percent of the votes respectively. Greenberg Traurig placed second in the Transactions category with 21 percent of the vote while Fried, Frank, Harris, Shriver & Jacobson placed second in Fund Formation with 23 percent.

More balance

PERE wrote last year about real estate’s pre-eminent manager in this region, Blackstone, losing its tight grip as it only won four awards. While still the most in the region, that was down from six in 2020.

The New York-based manager again claimed the most awards in North America, including regaining Firm of the Year from Starwood, but only managed to win three titles in total, also taking Deal of the Year and Nadeem Meghji claiming Industry Figure of the Year.

Blackstone’s wins did not come easily, either. The Deal of the Year win was sealed with its $12.8 billion take-private of American Campus Communities, the last standing public real estate investment trust focused on student housing. It beat out Prologis’s $26 billion purchase of Duke Realty Trust, the largest real estate deal ever, by two percentage points. 

Meghji held off Oak Street’s Marc Zahr thanks to his involvement in the ACC deal, as well as four other take-privates for the firm last year. The most notable other transaction was the $7.6 billion purchase of PS Business Parks. 

The trend away from one firm’s domination points to more balance in the region, with every investor or manager-focused award beyond those that Blackstone won being claimed by a different firm. Kirkland & Ellis was the only other winner of multiple awards. North America was the only region that had only one GP or LP win more than one award, a sign of its maturity and increasing competitiveness.