Nuveen exec launches private real estate business – Exclusive

Former Nuveen Real Estate executive Rahul Idnani is launching a private real estate business with Toronto-based Dream Unlimited to capitalize on opportunities arising from covid-related market dislocation, PERE has learned.

The new platform, Dream Equity Partners, will mark the Toronto Stock Exchange-traded property company’s entry into the private real estate space and function as Dream’s asset management business for private real estate clients, which will include institutional and retail investors such as pension funds, sovereign wealth funds and family offices.

Idnani will be president of Dream Equity Partners, which will focus on managing and developing office, multifamily, industrial and mixed-use assets in Canada, the US and Europe across core, core-plus and value-add strategies. He will be based in New York and report to Jane Gavan, president of Dream’s asset management division. She will become executive chair of Dream Equity Partners and will oversee the business.

Idnani, who joined Dream last month, previously served as global chief operating officer for Nuveen Real Estate for four years until his departure in March. In that role, he oversaw $90 billion of assets under management across various property types and investment strategies for the firm’s institutional and retail clients. Prior to this, he held senior leadership positions at TIAA for three years and was actively involved in the financial services organization’s 2014 acquisition of Nuveen Investments and subsequent build-out of its global real assets platform.

“I am very excited to join Dream and collaborate with their management team to provide private real estate offerings to clients,” said Idnani in a statement. “I am confident that Dream’s vertically-integrated operating platform, investment track record and history of astute capital allocation positions them as an ideal investment partner.”

Added Gavan: “I am very pleased to expand our asset management business focus to investing private capital in real estate. Rahul is a great addition to our team with his deep knowledge of the business and his global relationships. We believe that globally the allocation of capital to real estate will continue to grow and our unique track record, operating platform and core strengths, positions us well to attract investors.”

This track record includes Dream Global Real Estate Investment Trust, which Dream launched in 2011 to invest in office and industrial properties in Western Europe and sold last year to Blackstone for C$6.2 billion ($4.69 billion; €4.24 billion). The transaction generated since-inception total annualized returns of 15 percent to Dream Global’s unitholders – a performance that exceeded both the Canadian and European REIT benchmarks by approximately 60 percent over the same time period, according to the deal’s announcement.

Idnani noted that while Dream is starting its new private real estate business during the covid-19 crisis, the company had established Dream Global during the middle of the European debt crisis in 2011. “Similarly, we are launching Dream Equity Partners now because we believe that over the next several quarters, there will be opportunity to acquire good well-leased assets as well as good assets with some value-add leasing potential from distressed or forced sellers, so we want to be prepared to execute on those investment opportunities through our private investment vehicles,” he said.

He added: “The sale of Dream Global served as a catalyst to pivot Dream towards private capital to complement their traditional public equity sources,” which include three REIT subsidiaries – Dream Office REIT, Dream Industrial REIT and Dream Alternatives REIT – all of which are also traded on the Toronto Stock Exchange.

Over the coming months, Dream Equity Partners plans to meet and develop relationships with institutional clients and consultants, with the aim of raising dedicated private capital in discretionary vehicles. The new platform is expected to launch an impact investment fund – targeting investment areas such as affordable housing and energy and other resource efficiency – over the next few months. The new vehicle will be seeded with a portfolio that will come from Dream Unlimited’s balance sheet and pipeline of investments.

While Dream has primarily raised and invested public capital, it has previously partnered with private capital, including a 2014 joint venture with the Public Officials Benefit Association where the South Korean pension fund acquired a 50 percent interest in seven office properties in Germany for €221 million.

Dream, which was founded in 1994, has approximately C$9 billion of assets under management in North America and Europe. In addition to its public REIT subsidiaries, the company also has four operating businesses encompassing home and condominium development; residential development; retail shopping development; and renewable power. Dream is led by president and chief responsible officer Michael Cooper.