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Carlyle Raises Euro Real Estate Fund

The Carlyle Group has closed its third European real estate fund with $3.4 billion in capital commitments.




Global private equity firm The Carlyle Group today announces that it has closed its third European real estate fund, Carlyle Europe Real Estate Partners III (CEREP III), at $3.4 billion.  The fund was raised against an initial target of $2.3 billion, underlining ongoing, strong demand for pan-European real estate investment vehicles, and has already committed $1.1 billion to 10 assets. With leverage, the pan-European team of 46 people will have maximum funds of approximately $13.9 billion to invest.  The Carlyle Group now manages $10.8 billion in ten real estate funds across the world, including $5.3 billion of assets under management in Europe.  The total anticipated capitalisation of the global real estate portfolio is $31.4 billion, including committed equity and debt, of which $13.3 billion is in Europe.


Carlyle invests in all real estate asset classes, with a concentration on office, retail, hotel and residential assets across Western and Central Europe. Carlyle's two previous European real estate funds, CEREP I, (which raised $659 million) and CEREP II (which raised $1.2 billion), have invested a total of $2.8 billion (including reinvesting capital and co-investment) in 65 assets since 2001Carlyle's strategy is to identify real estate assets which need repositioning, often sourced through public or corporate disposals, where there is strong underlying potential for value creation. Carlyle develops new buildings or transforms existing assets into higher specification properties, which often set benchmarks for quality and sustainability.


In Europe, Carlyle invests primarily in single assets of more than $38.6 million. The identification and development of assets is undertaken by Carlyle's use of two in-house advisory teams, focused on investment and asset management. The teams, based in Paris, London, Frankfurt, Madrid, Milan, Luxembourg and Stockholm, have deep knowledge of their local markets and excellent relationship networks. The Fund invests in a spectrum of sectors, including office, residential, hotel, retail, logistic and industrial sectors, and considers mid-size corporate transactions where Carlyle believes there exists portfolios or assets that are not performing to their full potential. As well as equity investments, the Fund may also invest in debt-based instruments.


Eric Sasson, head of Carlyle's real estate operations in Europe, commented: “To have raised a fund of this scale, which exceeded our original target by a significant margin, underlines the continued confidence of investors in both the potential of real estate markets across Europe and Carlyle's ability to deliver superior returns. Our network of local country investment and asset management teams is an attractive proposition for investors, whose preference is to invest in vehicles where they can achieve focused asset class and pan-European geographic diversity through a single fund, rather than on a country-by-country basis.”




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The Carlyle Group is a global private equity firm with $81.1 billion under management committed to 60 funds. Carlyle invests in buyouts, venture & growth capital, real estate and leveraged finance in Africa, Asia, Australia, Europe, North America and South America focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, financial services, healthcare, industrial, infrastructure, technology & business services and telecommunications & media. Since 1987, the firm has invested $43.0 billion of equity in 774 transactions for a total purchase price of $229.3 billion. The Carlyle Group employs more than 1,000 people in 21 countries. In the aggregate, Carlyle portfolio companies have more than $87 billion in revenue and employ more than 286,000 people around the world.