PE Real Estate Funds Raise $25 Billion in Q1

LONDON (Reuters) – Private equity property funds could be set for another record year, having defied tough market conditions by raising $25 billion in the first quarter, research firm Private Equity Intelligence (Preqin) said on Thursday.

Blackstone's (BX.N: Quote, Profile, Research) global opportunistic fund, Blackstone Real Estate Partners VI, led the way with a record final closing of $10.9 billion.

Preqin said the total amount raised globally in the first quarter was bettered only once last year — in the second quarter, just before the start of a global credit crunch — and left the market on track to break above $100 billion in 2008 for the first time.

“Investors view private equity real estate funds as a long term investment prospect, and despite credit conditions many are increasing their allocation to the asset class,” Preqin spokesman Ignatius Fogarty said in a statement.

Preqin said a third of 307 private equity real estate funds currently trying to raise capital had already reached their interim closings and were targeting an aggregate $53.8 billion.

(Reporting by William Kemble-Diaz; Editing by Rory Channing)