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Strategic Partners amasses $1.3bn for RE Fund VI

The firm has hit the hard-cap on its first dedicated real estate secondaries fund raised since it was acquired by Blackstone in 2013.

Strategic Partners has hit the hard-cap on its first dedicated real estate secondaries fund launched since the firm was acquired by Blackstone, PERE's sister publication, Secondaries Investor, reported Wednesday.

The unit held the final close on $1.3 billion for its Strategic Partners Real Estate Fund VI (SP VI RE). The fund, which launched in December 2014, will focus on acquiring portfolios of high-quality real estate stakes and co-investments.

“This new pool of capital will enable Strategic Partners to commit to a wide range of compelling secondary real estate opportunities,” Mark Burton, head of Strategic Partners’ real estate practice, said in the statement. “We believe our disciplined approach to the real estate secondaries market creates value for our limited partners.”

Investors who committed to the fund include public, corporate and foreign pension funds, financial institutions, endowments, foundations and family offices around the world. Nevada System of Higher Education and Ohio Public Employees Retirement System have committed to the fund, according to PERE research. The target for SP VI RE was $750 million.

Strategic Partners bought a $3 billion portfolio of real estate fund stakes from the California Public Employees' Retirement System last October in what was the biggest-ever secondaries deal. The firm joined more than 10 co-investors to acquire the portfolio, which was made up of 43 international and domestic funds from CalPERS’ non-strategic, legacy real estate portfolio and comprised more than 350 underlying properties.

Deal volume in real estate fell almost 37 percent in the first half to $1.8 billion, according to a mid-year report by Setter Capital. The advisory firm estimates full year deal volume will be $3.9 billion, less than half the $8.2 billion that closed in 2015, according to a report by Landmark Partners released in January.

Strategic Partners has also raised $6.55 billion for its latest private equity secondaries fund, Strategic Partners Fund VII, surpassing the $6.5 billion hard-cap. The firm had not held a final close on the fund at the end of August.

The unit came third in Secondaries Investor's Si30 ranking of the top 30 secondaries fundraisers and has amassed $16.2 billion since 2011.