PGIM Real Estate recently finished raising capital for its European Value Partners Fund with €457 million in commitments from institutional and high net worth investors from around the world. EVP is the first in a series of closed-end discretionary real estate funds investing in value-add investment opportunities in Continental Europe. PGIM Real Estate is the real estate investment business of PGIM, Inc., the global investment management businesses of Prudential Financial, Inc. (NYSE: PRU).
Specifically, EVP invests in real estate with a value-add investment profile in Continental Europe, focusing on Germany, France, Spain and Italy, and seeks to enhance the value of investments through active tenant management, asset repositioning or specialized operational expertise.
“Continental 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,” said Raimondo Amabile, head of Europe for PGIM Real Estate and senior portfolio manager for EVP. “We appreciate our clients’ confidence in our ability to capitalize on these compelling market conditions to meet their investment objectives, as demonstrated by the strong participation from new and existing investors.”
EVP sold its first asset in July: 41 rue Ybry, an office property in the Neuilly-sur-Seine office submarket of Paris. The 15,000 square meter asset was acquired vacant in July 2015 in an off-market transaction, and then was fully pre-let to French cosmetics company Sephora (part of the LVMH group) as its global headquarters in December 2015, just months ahead of the recent sale.
Amabile continued: “Our strong ability and presence in key markets to source and execute real estate transactions with strong value creation potential is evidenced by the sale of 41 rue Ybry. We will continue to source compelling investment opportunities for our investors with the aim of creating significant value through tailor-made asset management.”
Other assets for EVP, which is currently 25% invested, include a portfolio of 26 properties located across Western Germany and a portfolio of three office buildings located in well-established Munich office submarkets.
PGIM Real Estate has been acting as a fiduciary manager for institutional investors in Europe since 1982. It has $7.6 billion in gross real estate assets across Europe ($5.3 billion net), as of June 30, 2016, with approximately 150 professionals in six locations across the region.
In addition to Amabile, Sebastiano Ferrante, head of Germany and Italy, is a senior portfolio manager. Nabil Mabed, executive director, is the portfolio manager on the team.