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MGPA closes Fund III with commitments of USD5.2bn

MGPA, a private equity real estate investment advisory firm previously known as Macquarie Global Property Advisors, has announced the final closing of its third fund with commitments total

MGPA, a private equity real estate investment advisory firm previously known as Macquarie Global Property Advisors, has announced the final closing of its third fund with commitments totalling USD5.2bn from 65 investors.

MGPA Fund III consists of two funds with regional investment mandates, MGPA Europe Fund III and MGPA Asia Fund III. M3 Capital Partners acted as placement agent.

MGPA says the twin funds have attracted a substantial level of renewed commitments from existing investors in North America, Australia, Europe and the Middle East, including corporate and public pension funds, insurance companies, foundations and endowments looking for exposure to the European and Asian real estate markets.

‘We are extremely pleased with the strong demand and continued commitment from our investors, reflecting their confidence in MGPA’s expertise and our track record in delivering strong returns from our property funds,’ says chairman and chief executive Jim Quille.

‘As a hands-on, value-add fund advisor, MGPA looks for inefficiencies and dislocations within the market where it can bring its asset and development management skills to bear. We find opportunities in all cycles of the market and the current uncertainty in the capital markets provides excellent opportunities for the funds.

‘We are currently witnessing less competition for deals, especially where high levels of leverage and financial engineering were driving certain buyers. Unless you can create real value through physically improving, developing or active asset management of real estate today, opportunities are less obvious, and this plays to MGPA’s strengths.’

MGPA Europe Fund III has raised USD1.3bn, creating potential buying power of USD5.2bn. The fund has already committed USD161m to investments in the residential sector in Wrocław, Poland and a strategic development site in Athens, Greece. The fund has a mandate to invest in the 27 states of the European Union as well as Switzerland and Norway.

‘In an environment of falling prices but with occupational markets remaining relatively robust, the investment landscape is particularly favourable for MGPA Europe Fund III,’ says Alex Jeffrey, chief executive of MGPA Europe. ‘We will be focusing on opportunities arising from dislocation and distress in Western Europe as well as continuing growth and convergence in Central and Eastern Europe.’

MGPA Asia Fund III has raised USD3.9bn, delivering potential buying power of USD15.6bn. The fund, which has a remit to invest across Asia, has already committed equity of USD2.2bn to investments in Singapore, Japan, China and Thailand in the office, retail, residential, hotel and logistics sectors, and has active opportunities under consideration in South Korea, Malaysia, Taiwan and Australia.

Simon Treacy, chief executive of MGPA Asia Investments, says: ‘The fund has made a strong start investing in its primary markets and is currently 56 per cent committed. It is well positioned to take advantage of opportunities across the region.’

MGPA, formed in 2004 and jointly own by its management and Australia’s Macquarie Group, is now an independently managed private equity real estate manager. Through its headquarters in Bermuda and a network of offices throughout Europe and Asia, MGPA currently manages USD11bn in assets across these two regions including development and redevelopment projects, joint ventures and real estate operating companies in the office, retail, industrial, residential and hotel sectors.

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