Ares Management agreed to buy AREA Property Partners. Ares is also buying a minority stake in AREA held by National Australia Bank. Financial terms weren’t disclosed. AREA Property is a real estate management firm that invests across North America, Europe and India.
Ares Management LLC announced today that it has signed a definitive agreement to acquire AREA Property Partners, L.P., a top-tier real estate management firm investing across North America, Europe and India. The transaction includes the acquisition of the minority stake in AREA held by National Australia Bank. The terms of the transaction were not disclosed, and the transaction remains subject to customary closing conditions including regulatory and investor approval.
Lee Neibart, Chief Executive Officer of AREA, will become a Senior Partner of the Ares Real Estate Group. Mr. Neibart will join John Bartling, a Senior Partner of the Ares Real Estate Group, as the Global Co-Heads of the Group. William Benjamin, AREA’s Head of Europe and India, will become a Senior Partner of the Ares Real Estate Group and continue as Head of Europe and India Real Estate.
“AREA’s expertise in value-add and opportunistic equity investing and mezzanine debt will complement our real estate group’s current capabilities in real estate private lending,” said Tony Ressler, Senior Partner and Chairman of the Executive Committee of Ares Management. “Further, the entire Ares Management platform will greatly benefit from AREA’s geographic reach, market insights, industry relationships and seasoned investment professionals – especially Lee Neibart in the U.S. and Bill Benjamin in Europe.”
“The combination, which will result in the Ares Real Estate Group having approximately $8 billion of committed capital and more than 70 investment professionals upon closing, will benefit our respective employees, investors and real estate partners,” added Mr. Bartling. “Our expanded offering, along with the significant resources and collaboration from across Ares Management, will make the Ares Real Estate Group a truly differentiated manager with global investment capabilities across the capital spectrum – from debt to equity.”
All existing AREA investment vehicles will continue to be managed by legacy AREA investment professionals in their capacities at Ares Management. William Mack, Founder of AREA, announced he will be stepping down as Chairman of AREA to focus on actively managing his family’s real estate initiatives, investments and philanthropic pursuits. Richard Mack, North America Chief Executive Officer of AREA, will become a Senior Advisor to the Ares Real Estate Group.
“As we transition to this exciting new phase of joining Ares, we want to acknowledge Bill Mack for his foresight, investment insights and unwavering integrity, which shaped the philosophy that has guided our firm over the past two decades. It was his vision and long-term commitment to building AREA that led to this opportunity to partner with Ares,” said Mr. Neibart. “Combining the complementary skill sets and asset classes of both firms will yield superior sourcing opportunities and enhanced credit analysis and information flow that will enable us to bring new products to investors while offering creative debt and equity financing solutions to the marketplace. The Ares Real Estate Group will now be a significant player at a time when we are seeing increasingly compelling opportunities in existing and new mandates.”
Hodes Weill & Associates acted as strategic advisor to AREA Property Partners and J.P. Morgan Securities LLC provided financial advisory services to Ares Management in connection with this transaction.
About Ares Management LLC
Ares Management LLC is a global alternative asset manager and SEC registered investment adviser, which had approximately $59 billion of committed capital under management and approximately 560 employees as of March 31, 2013, before giving effect to this transaction. Ares is headquartered in Los Angeles with professionals located across the United States, Europe and Asia and invests across the capital structure – from senior debt to common equity. Ares’ investment activities are managed by dedicated teams in its Capital Markets, Private Debt, Private Equity and Real Estate investment platforms. Ares Management was built upon the fundamental principle that each platform benefits from being part of the greater whole. This multi-asset class synergy provides its professionals with insights into industry trends, access to significant deal flow and the ability to assess relative value.
For additional information, visit www.aresmgmt.com.
About AREA Property Partners
AREA Property Partners is a leading international real estate investor and fund manager on behalf of prominent government and corporate pension funds, sovereign wealth funds, insurance companies, foundations, endowments, and high net worth individuals. Since the firm’s founding in 1993, AREA Property Partners has overseen the establishment of multiple real estate funds and joint ventures totaling $14 billion in equity commitments for investments in the United States, Europe and Asia. Its funds have collectively invested in over 600 transactions with an aggregated value in excess of $70 billion; as of March 31, 2013 AREA had approximately $6 billion of committed capital under management. Headquartered in New York, the firm has offices in Atlanta, San Francisco, London, Paris, Luxembourg and Mumbai. AREA’s funds target a broad range of opportunistic, value-added and debt investments in real estate assets and portfolios throughout North America, Europe, and India.