PGIM Real Estate has raised $1.1bn (£800m) for its second European value-add fund.
The European Value Partners II fund, or EVP II, is expected to be 70% deployed by the end of the year. It already has a strong seed portfolio comprised of 65% last-mile logistics, including developments in Paris and Berlin, and 25% in living assets. The fund will seek to enhance the value of its investments through active tenant management, asset repositioning and specialised operational expertise.
Since the launch of the first fund in the series, EVP I, in 2015, PGIM Real Estate has transacted $3.5bn in 23 deals across the UK, Germany, France, Spain and Italy. More than 70% were sourced off-market. EVP I is 80% realised and on-track to significantly outperform its targeted returns.
The team also has plans to deploy capital in the UK logistics sector, through a joint venture opportunity with an established property company. The fund has also been active in UK senior housing with a focus on high-end developments in the affluent Greater London sub-markets and in French residential where it has committed to deliver over €200m (£172m) worth of new affordable homes.
Head of Europe and Latin America, Raimondo Amabile, said: “Europe offers a compelling mix of value-add real estate opportunities resulting from market dislocation, a cyclical recovery and ongoing structural trends in the region. This successful fundraise demonstrates continued investor confidence in our strategy and European platform.”
He added: “We will continue to source compelling investment opportunities for our investors with a focus on affordable and senior living, logistics and offices in ‘smart cities’, with the aim of creating significant value through tailor-made asset management.”
PGIM Real Estate has $195bn in gross assets under management and administration, and is part of Prudential Financial’s $1.5tn global asset management business, PGIM.
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