Financial services provider Teachers Insurance and Annuity Association College Retirement Equities Fund (TIAA-CREF) has completed the launch of its previously announced joint venture with investment manager Henderson Global Investors, forming new real estate powerhouse TIAA Henderson (TH) Real Estate. The transaction, which also includes TIAA-CREF’s purchase of Henderson’s US business, is valued at £114.2 million ($190 million; €137.6 million), according to a statement from Henderson.
London-based TH Real Estate will pursue core and value-add investment opportunities in all major sectors of global commercial real estate. It launches with a combined $22.6 billion of assets under management (AUM) across 50 funds and mandates, overseen by a network of offices in Asia, Europe and North America. The joint venture is 60 percent owned by TIAA-CREF and 40 percent owned by Henderson.
“TIAA-CREF continues to evolve and expand its asset management business, and today's launch is a major step forward in our strategy to build a truly global investment organization,” said president of TIAA-CREF Asset Management Rob Leary in a statement. “Expanding the scale and scope of our global real estate business, already one of the largest and most diverse real estate investing platforms in the world, strengthens the franchise and helps us continue to meet the needs of sophisticated institutional clients.”
TIAA-CREF will continue to operate its existing $48.2 billion global real estate platform, which invests in directly owned property, real estate securities and private commercial mortgages.
The combination of TIAA-CREF's real estate platform and TH Real Estate represents approximately $71 billion in AUM as of December 31.
Concurrent with the launch, TIAA-CREF also completed the acquisition of Henderson's $2.6 billion North American property business. The business will be managed as a “distinct, yet complementary operation” within the existing TIAA-CREF real estate organization. It will continue to operate out of Hartford, Connecticut and Chicago with its current investment and client service team. The platform offers commingled funds and separate accounts for institutional clients, and invests across the four primary real estate sectors in US core and value-add strategies with an emphasis on the apartment, student housing and medical office sectors.