PE RE 30
The largest 30 private equity real estate firms in the world
The past year may have seen fundraising slow to a trickle for most private equity real estate firms, however
industry heavyweights are still pulling their weight when it comes to raising value-added and opportunistic
capital, according to the 2009 PERE 30.
For the second year running, PERE magazine has produced its ranking of the 30 largest private equity
real estate firms in the world.
Tracking direct-investment capital raised for blind pool, dedicated private equity real estate funds since
January 2004, the 2009 PERE 30 reveals that the largest 30 firms raised a total of $211.9 billion over the past
five years. That compares with $190 billion raised between 2003 and 2008, as calculated by last year’s list.
The line-up of the top 30 firms though has not remained static. Of the 24 firms that reappeared in the
top 30 list from last year, 12 fell one or more positions compared with 2008 and four remained static –
including the firms in first and second position.
Some firms managed to close sizeable fundraisings, which boosted their respective ranks significantly,
or allowed them to debut on the top 30 list. A total of eight firms increased their standing in the ranking,
while six new firms entered the field for the first time.
As in prior years, the PERE 30 is based on the amount of private equity real estate direct investment capital raised
over a five-year period. See www.privateequityrealestate.com for greater detail on the PERE 30 methodology.
All fundraising totals are calculated in US dollars. Where funds were raised in non US-dollar currencies,
we have taken the amount of capital raised in its original currency and converted it on 21 April using the
following rates: $1 = €0.77; £0.68; ¥98.66; C$1.24.
And now without further ado, we present the PERE 30 …
30 PRIVATE EQUITY REAL ESTATE MAY 2009
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PE RE 2009
THE PERE 30
2009 CAPITAL 2008
RAnk nAmE of fIRm HEAdQUARTERS RAISEd ($bn) RAnk
1 The Blackstone Group New York $25.60 1
2 Morgan Stanley Real Estate Investing New York $20.15 2
3 Goldman Sachs Real Estate Principal Investment Area New York $13.58 4
4 Colony Capital Los Angeles $11.56 5
5 Beacon Capital Partners Boston $9.75 9
6 Lehman Brothers Real Estate Partners New York $9.35 6
7 LaSalle Investment Management Chicago $9.05 10
8 Tishman Speyer New York $8.70 3
9 The Carlyle Group Washington DC $8.21 7
* Westbrook Partners New York $6.74 ―
11 MGPA London $6.31 11
12 CBRE Investors Los Angeles $6.12 15
13 AREA Property Partners New York $6.08 14
14 Rockpoint Group New York $5.56 13
* Prudential Real Estate Investors Parsippany (New Jersey) $5.39 ―
16 Lubert-Adler Real Estate Philadelphia $5.24 26
17 KK daVinci Tokyo $5.20 25
18 RREEF Alternative Investments New York $4.71 16
19 Walton Street Capital Chicago $4.70 22
* Hines Houston $4.25 ―
21 Citi Property Investors New York $4.10 20
22 Grove International Partners London $4.03 17
23 The JBG Companies Chevy Chase (Maryland) $3.98 19
24 Shorenstein Properties San Francisco $3.94 18
* Angelo, Gordon & Co. New York $3.78 ―
26 JER Partners McLean (Virginia) $3.38 21
* AXA REIM Paris $3.24 ―
28 Heitman Chicago $3.21 23
* DRA Advisors New York $3.00 ―
30 Starwood Capital Greenwich (Connecticut) $2.95 27
Legend: Higher rank than 2008 Lower rank than 2008 Same rank as 2008
* PERE 30 debut
32 PRIVATE EQUITY REAL ESTATE MAY 2009
PE RE 2009
PERE 30 methodology
Ranking the largest private equity real estate firms in the world rules strict rules and
judgment in this non-transparent asset class. Here we present our methodology for
the PERE 30.
After unveiling the first ever PERE 30 last year, we is counted in determining the PERE 30 rankings, as
were inundated with questions as to why, and how, described below.
we compiled the ranking. The PERE 30 only measures capital raised or
The answer to the first question is quite simple: formed within the most recent five-year window
people love lists. Over the years that we’ve been for dedicated, direct-investment private equity real
covering the real estate and private equity industries, estate programmes.
we have received numerous phone calls from people
who want to know who the largest players in the How we determine the 2009 rankings:
industry are. The 2009 PERE 30 rankings are based on the amount
That brings us to the second question: how we of private equity real estate direct-investment capital
compile our list. When we first contemplated ranking raised over a roughly five-year period leading up to
private equity real estate firms there were a number of press time. This year, the rough five-year window
ways we could have approached the issue, including spans from January 1, 2004 until April 24, 2009, just
measuring a firm’s assets under management and before the May 2009 issue of PERE goes to press.
the value of the undrawn capital committed to its Last year’s rankings were also drawn from a 64-month
funds. window, but of course last year the window started
By assessing a firm according to the amount of January 1, 2003 and ended mid-April, 2008.
private equity real estate direct investment capital it In coming up with our key “2009 PERE 30 Five-Year
has raised over a five-year period, we believe PERE Fundraising Total”, upon which the PERE 30 rankings
magazine has come up with a powerful apples-to- are based, we rely on the most accurate information
apples methodology for measuring size that takes into available to answer this question of each firm: How
account a firm’s heft going forward while indicating the much private equity direct-investment capital has the
scope of its recent investment activity. firm raise since January 1, 2004?
Where two firms have raised the same amount of
What is the PERE 30? capital over this time period, the higher PERE 30 rank
The PERE 30 is a ranking of private equity real estate goes to the firm with the largest active pool of capital
firms globally by size. It began in 2008 following the raised since 2004 (i.e., the biggest single fund). If there
success of the PEI 50, which ranked private equity is still a “tie” after taking into account size of single
firms. Both the PERE 30 and PEI 50 are produced by fund, we give greater weight the firm that has raised
PEI Media, the publisher of PERE and Private Equity the most capital within the past one or two years.
The PERE 30 is the only apples-to-apples comparison Accuracy, confidentiality:
of dedicated, direct-investment private equity real estate We give highest priority to information that we receive
programmes. The PERE 30 is not a performance ranking, from or confirm with the private equity real estate firms
nor does it constitute investment recommendations. The themselves, often on background. When the private
PERE 30 includes private equity real estate firms with equity real estate firms themselves confirm details, we
varying structures and strategies around the world. While seek to “trust but verify”. Some details simply cannot
the list is mostly made up of private equity real estate be verified by us, and in these cases we defer to the
firms that manage private equity limited partnerships, it honour system. In order to encourage cooperation
also includes firms with multiple strategies and business from private equity firms that might make the PERE
lines and firms with publicly traded vehicles. However, 30, we do not disclose which firms have aided us on
only a defined type of private equity real estate capital background and which have not.
33 PRIVATE EQUITY REAL ESTATE MAY 2009
PE RE 2009
Lacking confirmation of details from the firms themselves, • Private equity: we do not count capital raised for
we seek to corroborate information using available the primarily private equity (i.e. operating business-
firms’ own websites, press releases, news reports, third- focused) strategies. Many private equity real estate
party databases, limited partner disclosures, etc. firms will invest in operating businesses, but their
primary focus is on property investment.
To help answer this question – How much private equity • Infrastructure: we do not count capital raised for
real estate capital has the firm raised since January 1, primarily infrastructure investment strategies.
2004? – some definitions are in order.
• Structured debt: we do not count capital raised for
• “Private equity real estate”: The definition of private any collateralised bond obligation or debt obligation
equity real estate, for the purposes of the PERE 30, programmes.
means equity capital raised for a dedicated program of
investing directly into property, primarily. The capital is • Debt investment funds: we do not count debt
raised primarily in blind-pool limited partnerships. These investment funds, including mezzanine debt.
investment programs are further distinguished in that they
do not primarily pursue what is often described as “core” What counts as “capital raised?”
or “core-plus” investment strategies, but rather “private
equity,” “opportunistic” and/or “value-added” strategies, • Limited partnerships: in most cases, private equity
primarily. The fund managers primarily do not seek to real estate firms raise money through commitments to
own the assets in perpetuity but to eventually exit them, limited partnerships. In some cases, investment capital is
realizing a capital gain and generating an internal rate of raised in other ways, for example through contributions
return for the fund and its investors. Within the private from an affiliated entity. In all these cases we have
equity real estate market there are certainly gray areas sought to accurately determine how much investment
with regard to strategy definitions, but PERE will took capital has been created for the financial sponsor in
pains to ensure that the capital counted for the purposes question over the specified five-year period.
of the PERE 30 fell within our definition of “private equity
real estate” to furthest extent possible. • Co-investment capital: where possible and
appropriate, we count LP co-investment vehicles
• “Capital raised”: This means capital definitively as well as opportunistic LP co-investment capital
committed to a private equity real estate direct raised by private equity real estate sponsors. This
investment fund. In the case of a fundraising, it means co-investment capital must be invested alongside a
the fund has had a final or official interim close on or primary limited partnership, not established for a one-
after January 1, 2004. The full amount of a fund if it off deal or separate account.
has close on or after this date may be counted. The In deals where multiple sponsors have raised co-
full amount of an interim close (a real one, not a “soft- investment capital, we only counted the firm’s pro-
circle”) that has occurred recently, even if no official rata share of the co-investment capital raised (in other
announcement has been made, may also be counted. words, if a firm and three other firms raise $1 billion in
We also count capital raised through other means, LP co-investment capital for a deal, no firm is allowed
such as co-investment vehicles and deal-by-deal co- to count the whole $1 billion for itself).
investment capital and earmarked annual contributions
from a sponsoring entity. Further rules are below. • Affiliated programmes: we counted private equity
real estate capital raised by affiliated entities so long as
What does not count as “private equity real estate”? the firm has control over those entities, or the vehicles
raised bear the clear branding of the firm.
• Funds of funds: in the case of a primarily fund-of-
funds programme, we only count direct investment • Contributions from sponsoring entities: where a larger
capital raised, if any. entity has earmarked capital to a firm for a dedicated, direct
private equity real estate program, we counted the amount
• Separate accounts of capital a firm drew down from that entity for direct private
equity deals over the defined five-year period.
34 PRIVATE EQUITY REAL ESTATE MAY 2009
PE RE 2009
By the numbers
LInIng UP THE fIgURES
A graphic representation of the 2009 PERE 30 shows two firms have raised disproportionately large
amounts of captial over the past five years, followed by a more gradual reduction in the amount of value-
added and opportunistic real estate capital raised. For a full explanation of the methodology used, see www.
The Blackstone Group
Morgan Stanley Real Estate Investing
Goldman Sachs Real Estate Principal Investment Area
Beacon Capital Partners
Lehman Brothers Real Estate Partners
LaSalle Investment Management
The Carlyle Group
AREA Property Partners
Prudential Real Estate Investors
Lubert-Adler Real Estate
Walton Street Capital
Citi Property Investors
The JBG Companies
Source: Private Equity Real Estate
Angelo, Gordon & Co.
$0 $5 $10 $15 $20 $25 $30
Capital raised over last ﬁve years ($bn)
35 PRIVATE EQUITY REAL ESTATE MAY 2009
PE RE 2009
TRAnSACTIon PowER of THE ToP 6 PRoPERTY PowER of THE ToP 6
The PERE 30 firms bought and sold more than The PERE 30 firms traded more than 14,100
$530 billion of property between January 2004 and properties over the past five years, according to
mid-April 2009, according to Real Capital Analytics. Real Capital Analytics. Blackstone was in the lead
Blackstone and Morgan Stanley were the most active buying and selling 1,892 properties, followed by
firms with more than $147.2 billion of transactions Grove International on 1,498 properties. Here we
alone. Here we present the top 6 firms. * represent the top 6 firms. *
Blackstone Blackstone, 1,892 properties
RREEF, 869 properties
Macquarie Group, 848 properties
RREEF $43.5 bn
Goldman Sachs Goldman Sachs, 711 properties
Source: Real Capital Analytics Source: Real Capital Analytics
SECToR foCUS PERE 30 VS. PEI 30
PERE 30 firms dealt primarily with office and retail PERE 30 firms raised more than $212 billion in
properties over the past five years, according to funds over the past five years compared to $647
Real Capital Analytics. billion raised by the top 30 private equity firms over
the same period.
% of transactions by sector by
PERE 30 Jan 04 - April 09
20 $647 bn
10 9% $
19% $190 $212 bn
Retail Industrial Apt Hotel Dev site 0 100 200 300 400 500 600 700 800
Source: Private Equity Real Estate Source: Private Equity Real Estate and Private Equity International
* Data provider Real Capital Analytics has tracked the volume and value of property transactions for the PERE 30 firms from 1 January, 2004 to the beginning of April 2009.
It covers activities by the parent companies, as well as by a firm’s dedicated private equity real estate funds.
36 PRIVATE EQUITY REAL ESTATE MAY 2009
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