2018 Global Real Estate Capital

5 February 2019

Preqin recently released their Q4 2018 global fund raising update covering the activity of all Private Equity markets. According to the Preqin report, the closed-end private real estate market shows some signs of having slowed in 2018. Overall fundraising activity remains substantial, with 298 funds closing globally in 2018, raising a total of $118bn well short of the 406 funds that raised $132bn in 2017. Value added funds were the most numerous, with 115 funds closing, while opportunistic funds secured the most capital ($43bn). Debt funds continued their strong fundraising from 2017, but core and core-plus fundraising fell sharply from 2017. Tom Carr, Head of Real Estate said that despite concerns about potential market corrections, it does not seem that investor appetite is slowing or moving down the risk/return curve. Debt funds had another strong year, but core and core-plus fundraising was less than half of 2017’s levels. This is despite many investors saying that they were seeking to position themselves in anticipation of a correction in the next 3 years and would be targeting these lower risk strategies in the coming months.