Fig. 1: North America-Focused Closed-End Private Real. Estate Dry Powder, December 2006 - August 2016. Source: Preqin Re
Real Estate Market Outlook: North America
The Facts
alternative assets. intelligent data.
Real Estate Market Outlook: North America Using Preqin’s recent survey of almost 200 real estate fund managers and the newly expanded Real Estate Online, we provide an overview of the current private real estate landscape in North America.
Key Facts
128 119
120
Dry Powder ($bn)
106 95
100 84 80
86
93
102
89
78
70
60 40
Fig. 2: North America-Based Fund Manager Views on the Level of Competition for Real Estate Assets Compared to 12 Months Ago by Asset Type 100% 90% 80%
40%
70% 60% 50% 40% 30%
41% 45%
10%
All
15%
20
Aug-16
Dec-15
Dec-14
Dec-13
Dec-12
Dec-11
Dec-10
Dec-09
Dec-08
Dec-07
Dec-06
0
More Competition Same Level of Competition
46% 43%
20% 0%
25%
14%
5%
Less Competition
Asset Type
Source: Preqin Real Estate Online
Fig. 3: Amount of Capital North America-Based Fund Managers Plan to Deploy in Real Estate Assets in the Next 12 Months Compared to the Past 12 Months
34%
40%
53%
Opportunistic
140
$76bn
Aggregate value of North American private equity real estate deals completed in 2016 YTD (as at 17 August 2016).
Value Added
Fig. 1: North America-Focused Closed-End Private Real Estate Dry Powder, December 2006 - August 2016
55%
Proportion of North Americabased fund managers that feel it is more difficult to find attractive investment opportunities compared to 12 months ago.
Core/ Core-Plus
50%
Proportion of North Americabased fund managers that consider ESG factors as part of their deal-making process.
Proportion of Respondents
62%
Proportion of North Americabased fund managers that report higher pricing for real estate assets compared to 12 months ago.
Source: Preqin Fund Manager Survey, June 2016
Fig. 4: North America-Based Fund Manager Views on the Impact of Asset Valuations on Targeted Returns of Funds Brought to Market by Fund Manager AUM 100%
Significantly More Capital
1%
32%
Slightly More Capital Same Amount of Capital
27%
Slightly Less Capital
30%
Significantly Less Capital
90%
Proportion of Respondents
10%
80%
36% 57%
70%
47%
Reduced Targeted Returns
60% Targeted Returns Independent of Valuations
50% 40%
48%
30%
47% 41%
20% 10%
16%
0% Less than $250mn
3% $250mn-$1bn
Increased Targeted Returns
6% More than $1bn
Fund Manager AUM
Source: Preqin Fund Manager Survey, June 2016
Page 1 of 2
Source: Preqin Fund Manager Survey, June 2016
© 2016 Preqin Ltd. / www.preqin.com
Real Estate Market Outlook: North America
The Facts
alternative assets. intelligent data.
Fig. 5: Annual Number and Aggregate Value of North American Private Equity Real Estate Deals, 2011 - 2016 YTD (As at 17 August 2016) 1,640
1,600
No. of Deals
1,296
1,200
800
90%
100
968
900
826
140 120
1,111
1,000
100%
80 60
600
40
400
Aggregate Deal Value ($bn)
1,400
160
0 2012
2013
No. of Deals
2014
2015
Niche
60%
Hotel
50%
Industrial
40%
Retail Mixed Use
20%
Residential
10%
0 2011
70%
30%
20
200
Operating Company Land
80%
Proportion of Deals
1,800
Fig. 6: North American Private Equity Real Estate Deals by Primary Asset Type, 2011 - 2016 YTD (As at 17 August 2016)
2016 YTD
Office
0% 2011
Aggregate Deal Value ($bn)
2012
2013
2014
Source: Preqin Real Estate Online
Fig. 7: North American Private Equity Real Estate Deals Completed in 2016 YTD by Primary Asset Location (As at 17 August 2016) 40%
100% 90%
20%
17%
18%
25%
22%
80%
21% 18%
15%
24%
12%
10% 5%
No. of Deals Aggregate Deal Value
9% 6% 5% 4%5% 4% 4% 4% 2% 3% 3% 2%
Other
Massachusetts
Washington
Arizona
Illinois
Texas
Florida
New York
California
0%
Proportion of Total
Proportion of Total
Fig. 8: North American Private Equity Real Estate Deals by Asset Size, 2015 vs. 2016 YTD (As at 17 August 2016)
30% 25%
2016 YTD
Source: Preqin Real Estate Online
37% 36%
35%
2015
70%
53%
60%
40%
35%
35%
30%
10%
500,000ft² or More 250,000500,000ft²
50%
20% 25%
23%
0% 2015
2016 YTD
No. of Deals
Primary Asset Location
52%
24%
26%
100,000249,999ft²
16%
15%
Less than 100,000ft²
8%
7%
2015
2016 YTD
Aggregate Deal Value
Source: Preqin Real Estate Online
Source: Preqin Real Estate Online
Fig. 9: 10 Largest North American Private Equity Real Estate Deals Completed in 2016 YTD (As at 17 August 2016) Asset
Primary Asset Type
Transaction Type
Buyer(s)
Seller(s)
Deal Size (mn)
US, Residential Portfolio
Residential
Portfolio
Brookfield Property Group
NorthStar Realty Finance
US, Multi-Family Portfolio
787 Seventh Avenue 388-390 Greenwich Street UBS Tower Wexford Diversified Portfolio
Location
Deal Date
2,040 USD
US
May-16 Jan-16
Residential
Portfolio
Blackstone Group
Greystar Real Estate Partners
2,000 USD
Boston, Los Angeles, New York, San Francisco, Seattle
Office
Single Asset
California Public Employees' Retirement System (CalPERS), CommonWealth Partners
AXA Investment Managers – Real Assets
1,900 USD
New York
Feb-16
Mixed Use
Single Asset
Unidentified seller
SL Green Realty
1,760 USD
New York
May-16
China Life Insurance, RXR Realty, Unidentified Buyer/s
AXA Investment Managers – Real Assets, JP Morgan Asset Management
1,650 USD
New York
May-16
Office
Single Asset
Industrial
Portfolio
Ventas Inc
Blackstone Group
1,500 USD
US
Jul-16
Blackstone Group
1,340 USD
Los Angeles
Mar-16
Los Angeles, CA, Office Portfolio
Office
Portfolio
Douglas Emmett, Qatar Investment Authority
US, Office Portfolio
Office
Portfolio
Blackstone Group
Hines
1,162 USD
Chicago, Dallas, Los Angeles
Jul-16
The Shops At Crystals
Retail
Single Asset
Invesco Real Estate, Simon Property Group
Unidentified Seller/s
1,100 USD
Las Vegas
Apr-16
US, Diversified Portfolio
Retail
Portfolio
Prologis
Morris Companies
820 USD
US
Feb-16
Source: Preqin Real Estate Online
Page 2 of 2
© 2016 Preqin Ltd. / www.preqin.com
