Insights

KAP’s insights on private equity investor relations and fundraising

 

RE secondaries volume up; Wynn continues Las Vegas expansion; PGIM RE bolsters impact investing team

 

MARKET NEWS

Downtown Los Angeles is experiencing a flood of multifamily supply. More than 4,000 new apartments are forecast to hit the market this quarter, with as many as 30,000 expected over the next three years. Much of the construction is concentrated downtown and almost all the new apartments will serve the higher end of the market.

“This is the heaviest period in multifamily construction in Los Angeles since the early ’90s,” – Steve Basham, CoStar Analyst

Real estate secondaries dollar volume jumped 20% from 2016 to 2017. According to a report from secondaries firm Landmark Partners, 108 secondaries deals closed or went under contract in 2017, totaling $6 billion. Endowments comprised the bulk of sellers, accounting for 46% of transaction volume. Harvard Management Company led its peers, selling almost $2 billion of real estate assets to Landmark and Carlyle’s Metropolitan Real Estate.

IREI and GRESB published their second ESG Means Business report together. The complimentary 20-page report focuses on the accelerating acceptance and maturing best practices of ESG investing.

 

CAPITAL RAISING UPDATES

  • Square Mile Capital launches new debt fund. Square Mile Credit Partners II (SCMP II) will focus on the origination and acquisition of first mortgage loans, mezzanine loans and B-notes in the U.S. No fundraising target has been announced.

 

NOTABLE TRANSACTIONS

Wynn Resorts plans fourth Las Vegas hotel. The new hotel will be built on the site of the former Frontier hotel, across Las Vegas Boulevard from Wynn’s two existing properties and will feature approximately 2,500 hotel rooms. Wynn acquired the 38-acre site for $336 million in December. The company’s average room rates are rising and will likely hit $400 by the time all the rooms under construction are finished.

 

PEOPLE MOVES

PGIM Real Estate hires Lisa Davis to lead impact investing. Davis will join the firm as executive director and portfolio manager to lead impact-oriented real estate investment initiatives focused on affordable housing in the U.S. Throughout her career, Davis has focused on improving housing and economic conditions in low-income communities. Prior to PGIM Real Estate, she executed large-scale affordable housing and redevelopment projects for both for-profits and nonprofits. Previously, Davis led affordable housing and community development finance strategies at the Ford Foundation and helped establish Ford’s impact investing program.

 

 

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