In this month’s issue of PERE, Keith Breslauer explains the ethos behind the firm that raised the largest European private equity real estate fund in 2012.
A strong clue as to the way the company works can be found at the entrance to its office in the west end of London. On display are photos and momentos of various charitable projects Patron has backed, such as Akshayapatra, a charity to which former Hypo Real Estate professional Harin Thaker, now devotes much time.
Breslauer says: “The combination of work, support and charity is part of our ethos and that is what this shows. The theory is we are here to change the world. Not sure we do, but that’s the theory.”
Patron closed Patron IV on €880 million of equity last year. According to Breslauer, Patron had to work like madmen to accomplish the feat, and got more than 100 investors into the fund because commitments made by some returning US universities and faculties were smaller than before due to capital constraints, or nervousness about Europe, or both. It now has news LPs hailing from the Middle East, and sovereign wealth funds.
He says one reason for the firm’s success is to do with the firm’s hard-working culture.
The firm has 10 leading partners in total. “Our ability to raise money, communicate with everybody and lead from the front is a style that every senior member of the team thinks like. I have been able to find people who think like me. The force of (my) personality is probably down to the fact that I speak more and I probably have more energy than most and I help as a catalyst of ideas. But it does not mean in any way that it is ‘me.’”
A good example are the two senior partners in the company: Mark Collins is chairman of UK investment, and Kevin Cook, is senior development director. “I knew that in certain areas I did not have a particular skill set, so I learn from them. Shane Law, who is my right hand man, is another one. He knows how to do things that I don’t know, such as process – managing a deal from beginning to end in all possible aspects, including dealing with the necessary bureaucracy in transactions. We are working on a deal right now where another fund is a co-investor potentially. For us, we have already taken care of capital calls necessary and so forth. We are on top of it. The success of the company is the team, and that is not BS.”
What really matters to Breslauer is the performance of Fund IV. He says he doesn’t really care about other metrics one could use about the firm such as the amount of capital raised or how many products it has. “Fund IV has to make a lot of money and that is it. That is basically the driving force.”
So, with deploying Fund IV the main target, does Breslauer feel he is on course in his business life? He repeats that delivering a great outcome for Fund IV is the objective. When asked why, he says this: “The honest answer, no matter how corny it sounds, is I believe I have been put on this earth to make a substantial change. In order for me to do that, I have to be financially very successful and plant all the seeds necessary to allow that change to exist. That change could be to individuals, to my environment. When I look at my client base, the fact that we have so many charities is a huge responsibility. If we screw things up, our charities may not have enough money to pay for their causes. The money they gave me is a retirement plan for a priest who makes $25,000 a year. So I look at that as part of the thesis that drives me.”
For the full interview, see this month’s issue of PERE.