ElmTree Funds, a private equity real estate firm, has teamed up with China Life, a Chinese financial insurance company, to recapitalize an existing ElmTree net lease portfolio for $950 million. The portfolio assets are build-to-suit properties that are mostly leased to investment grade tenants. Hodes Weill Securities LLC provided financial advice to ElmTree Funds on the transaction.
ST. LOUIS–(BUSINESS WIRE)–ElmTree Funds, LLC, a leading private equity real estate firm, is pleased to announce a $950 million recapitalization with a wholly-owned subsidiary of China Life Insurance Group (“China Life”), the largest financial insurance corporation in China, of an existing ElmTree net lease portfolio. This strategic partnership reflects the appeal of ElmTree Funds’ platform and the strong outlook supporting commercial real estate net lease investments.
“We are honored to form this strategic joint venture with China Life, who recognizes the inherent value in the high quality portfolio that we have assembled and shares our bullish outlook on the net lease sector,” said Jim Koman, managing principal at ElmTree Funds. “This transaction gives China Life immediate scale and diversification in the U.S. market. We look forward to a highly productive, long-term relationship with China Life as we explore additional opportunities to invest together.”
The joint venture’s portfolio will initially comprise 48 single-tenant properties aggregating more than 5.5 million square feet across 20 states. The transaction agreement provides for the acquisition of two additional single-tenant net lease properties from ElmTree Net Lease Fund II, subject to certain conditions.
The vast majority of the assets in the portfolio are recently constructed build-to-suit properties that are primarily leased to investment grade tenants and situated in secondary and tertiary markets that exhibit strong long-term economic and demographic fundamentals. ElmTree Funds will continue to serve as asset manager of the portfolio and employ a core/core-plus investment strategy.
Hodes Weill Securities, LLC, a global real estate advisory boutique, acted as the exclusive financial advisor to ElmTree Funds.
About ElmTree Funds
ElmTree Funds, LLC is a leading private equity real estate firm and seasoned fund manager to institutional and private investors. ElmTree’s investment philosophy focuses on creating attractive risk-adjusted returns for its investors in the commercial real estate net lease, sale-leaseback, and build-to-suit sectors. Since its founding in 2011, ElmTree Funds has acquired, developed or financed more than $1.5 billion of office, industrial and healthcare properties. ElmTree Funds targets investments in secondary and tertiary markets across the United States that are leased to investment grade tenants on a long-term basis. ElmTree Funds is headquartered in St. Louis, Missouri. For more information please visit www.elmtreefunds.com.
About China Life Insurance Group
China Life Insurance (Group) Company is one of the largest insurance corporations and institutional investors in China’s capital market. Its business scope covers life insurance, property & casualty insurance, pension, asset management, alternative investment, overseas business and others. By the end of 2015, consolidated total assets of the group company exceeded RMB 3 trillion, which is ranked as the highest in the industry in China. For more information please visit www.chinalife.com.cn.
About Hodes Weill & Associates
Hodes Weill & Associates is a real estate advisory boutique with a focus on the investment and funds management industry. Founded in 2009, the firm provides institutional capital raising for funds, transactions, co-investments and separate accounts; M&A, strategic and restructuring advisory services; and fairness and valuation analyses. All U.S. regulated capital market and securities advisory services are provided by Hodes Weill Securities, LLC, a registered broker-dealer with the SEC, and a member of FINRA and SIPC, and internationally, by non-U.S. Hodes Weill affiliates. For more information please visit www.hodesweill.com.