For many in private equity real estate, the hiring of David Brush by Brookfield Asset Management crystallised a perception about RREEF Real Estate. Indeed, a number of observers fervently believed that staff would not sit still amid prolonged uncertainty at the alternative asset management business after Deutsche Bank announced a review of many parts of its asset management division in December.
In July, Brush, a 20-year veteran of Deutsche Bank, decided to leave the firm, having most recently served as chairman of RREEF’s real estate opportunities funds (REOF) group. Speaking with PERE one week after Deutsche Bank announced it had finally decided to keep RREEF, Brush said he preferred to look forward rather than backwards as he began a ‘second’ career.
Brush began his career in real estate in 1987, when he joined the real estate investment banking group of Bankers Trust. He became part of Deutsche Bank the following year, when the German bank took over Bankers Trust. Then, in 2002, Deutsche Bank took over Chicago-based RREEF for $490 million. It was a good marriage, with Deutsche Bank having the skills in the higher-risk opportunistic end and RREEF possessing strength in core and core-plus strategies.
As one of the best-known opportunistic real estate professionals in Europe, Brush carved out an exciting time at RREEF, including takeovers and distressed deals in the years that followed the firm’s acquisition under the watch of Richard Grunthel, the former boss of real estate at Deutsche Bank Asset Management’s alternative investment division. Grunthel now runs his own firm, True North Management Group in New York.
In June 2007, Brush spent his ‘last day’ at RREEF as he ‘retired’ from investing. However, that spell on the sidelines did not last long. Indeed, in the aftermath of Lehman Brothers’ collapse, he rejoined RREEF as chairman of REOF in 2008.
Now, Brush is working full time at Brookfield and has spent the summer learning the organisation alongside senior managing partner Barry Blattman and global head of real estate Ric Clarke. Last month, he settled into life at his new firm.
Brookfield, Brush explained, has the flexibility to invest in real estate via different “silos.” For example, it has Brookfield Strategic Real Estate Partners (BSREP), the opportunity fund business, which currently is on the fundraising trail. There also is Brookfield Office Properties, which was beefed up in the UK last year with the appointment of Martin Jepson. The piece that Brookfield had been missing is European opportunistic expertise.
“Brookfield has different pools of capital to cover the full investment spectrum,” Brush said, adding there was no real management “silo” in his new role as managing partner of European real estate investment activities. He noted that Jepson and team were focusing their activities firstly on London offices, but eventually Brookfield would wish to invest in Continental Europe.
One GP in Europe observed that Brush is a good hire for Brookfield. “Europe has been a bit of an outpost for Brookfield,” he said. “Over here, you are not in the inner circle of Brookfield’s real estate management, but David is the kind of guy to get his voice heard.”