Private Equity Real Estate Investment Firm – Below you can find a list with information about 41 private equity firms in the real estate industry. This blog post can help you identify private equity firms in the real estate industry and other active M&A market participants today.
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Private Equity Real Estate Investment Firm
Investment firm AMP Capital Investors has a long history and strong foundation in infrastructure and real estate.
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With US$120 billion of real estate and private equity funds under management, GLP is a global investment firm.
A global private equity and alternative asset investment firm, H.I.G. Capital currently manages $42 billion in equity.
It is a leading independent alternative investment management company that specializes in investing in upstream oil and gas companies.
Private equity firm Starwood Energy Group is headquartered in Greenwich, Connecticut and focuses on energy infrastructure investments.
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Brookwood Financial Partners is a Massachusetts-based private equity firm that invests in real estate and business securities.
Kohlberg is Kravis Roberts, an international alternative asset manager with a focus on equity, fixed income and private equity markets.
With more than $11 billion in capital, Marathon Asset Management LP is a global alternative investment and asset management firm.
In the Americas, Europe and Asia, Silverfern, a pioneer in active global co-investment, invests directly in private equity and real estate.
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Simon Investment Managers is a private fund manager with a focus on real estate and alternative assets.
Trinity Private Equity Group provides assistance to middle market businesses with a focus on equity investments and direct real estate acquisitions.
An international asset management company called Apollo Global Management focuses on capital and real estate markets that are credit oriented.
A private investment firm called Ardian is autonomous and manages or advises on $55 billion in assets.
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PAG is one of Asia’s leading investment managers, focused on delivering value to investors and helping them reach their full potential.
And Uncapped has partnered to provide startup acquirers with fast, tailored and flexible access to capital for acquisition funding. Private equity describes investment partnerships that buy and manage companies before selling them. Private equity firms operate these investment funds on behalf of institutional and accredited investors.
Private equity funds may acquire private companies or public persons in their entirety or invest in such acquisitions as part of a consortium. I generally do not invest in listed companies.
Private equity is often grouped with venture capital and hedge funds as alternative investments. Investors in this asset class typically have to commit significant capital for years, so access to such investments is limited to institutions and high net worth individuals.
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Unlike venture capital, most private equity firms and funds invest in mature companies rather than startups. They manage their portfolio companies to grow in value or extract value before exiting after years of investment.
The private equity industry has grown rapidly on the back of increased allocations to alternative investments and relatively strong private equity fund returns since 2000. In 2021, private equity acquisitions reached a record $1.1 trillion, doubling from of 2020. Private equity investments are becoming increasingly attractive and growing. Popular when stock markets are high and interest rates are low and low when these cyclical factors are less favorable.
Private equity firms raise capital from clients to establish private equity funds and operate them as general partners, managing the fund’s investments in exchange for a fee and a share of profits above a predetermined minimum known as a hurdle rate.
Private equity funds have a limited tenure of 7 to 10 years and the money invested in them is not available for later withdrawal. Funds usually start distributing profits to their investors after years. The average holding period for a private equity portfolio company was approximately five years in 2021.
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Blackstone Group Inc. (BX) in 2007 through an initial public offering (IPO), many of the largest private equity firms are now publicly traded companies. In addition to Blackstone, KKR & Co. Inc. (KKR), Carlyle Group Inc. (CG) and Apollo Global Management Inc. (APO) all have shares traded on US exchanges. Many smaller private equity firms have also gone public through IPOs, mainly in Europe.
Some private equity firms and funds specialize in a particular category of private equity transactions. While venture capital is often listed as a subset of private equity, its distinct functions and expertise set it apart and have spawned dedicated venture capital firms that dominate their field. Other private equity features include:
Deals in which private equity firms buy and sell portfolio companies can be categorized based on their circumstances.
A buyout remains a staple of private equity transactions, involving the acquisition of an entire company, whether public, closely held or privately held. Private equity investors who buy an underperforming public company often look to cut costs and restructure its operations.
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Another type of private equity acquisition is a carve-out, where private equity investors buy a division of a larger company, usually a non-core business put up for sale by its parent corporation. Examples include Carlyle’s 2014 acquisition of Tyco International Ltd. From Tyco Fire & Security Services Korea Co. Ltd. and includes Francisco Partner’s agreement to acquire corporate training platform Litmos from German software company SAP SE (SAP), announced in August 2022. -Outs tend to yield lower valuation multiples than other capital acquisitions private, but can be more complex and risky.
In a secondary buyout, a private equity firm buys a company from another private equity group instead of a listed company. Such transactions were considered distressed sales, but have become common amid the increasing specialization of private equity firms. For example, a firm looking for a platform to acquire complementary businesses may buy a company to reduce costs before selling to another PE partnership.
Other exit strategies for private equity investments include the sale of the portfolio company to one of its competitors, as well as its IPO.
When a private equity firm buys a company, it already has a plan to grow the value of the investment. This may involve dramatic cost cutting or restructuring, which the company’s current management may be reluctant to undertake. Private equity owners have more of an incentive to make major changes with limited time to add value before exiting the investment.
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A private equity firm may also have special expertise in the absence of a previous management company. It can help a company develop an e-commerce strategy, adopt new technologies or enter additional markets. A private equity firm acquiring a company may bring in its own management team to pursue such initiatives or retain former managers to execute an agreed upon plan.
An acquired company can make operational and financial changes without the pressure to meet analysts’ earnings estimates or please its public shareholders every quarter. Private equity ownership can allow management to take a long-term view, as long as it does not conflict with the new owner’s goal of producing the highest possible return on investment.
But as debt remains a significant contributor to private equity returns, an increase in fundraising has made leverage less necessary. Debt used to finance an acquisition reduces the size of the equity commitment and increases the potential return on that investment, despite the increased risk.
Private equity managers can also lend more to accelerate their returns to the acquired company through dividend recapitalizations, which finance dividend distributions to private equity owners with borrowed money.
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Dividend recaps are controversial because they allow a private equity firm to quickly extract value while taking on an over-indebted portfolio company. On the other hand, the increased debt will likely reduce the company’s valuation when it is sold again, while creditors must agree with the owners that the company will be able to handle the resulting debt load.
Private equity firms rejected the stereotype of corporate assets as strip miners, highlighting their management expertise and examples of successful transformations of portfolio companies.
Many emphasize their commitment to environmental, social and governance (ESG) standards that direct companies to consider the interests of stakeholders other than their owners.
However, the rapid changes that often follow a private equity buyout can often be difficult for a company’s employees and the communities in which it operates.
Private Equity Funds
Another frequent source of controversy is the interest provision that allows private equity managers to tax most of their compensation at a lower capital gains tax rate. Legislative efforts to tax the compensation as income have been repeatedly defeated, most notably when the change was left out of the Inflation Relief Act of 2022.
A private equity fund is managed by a general partner (GP), usually the private equity firm that established the fund. The family doctor makes all the management decisions of the fund. Contribute 1% to 3% of the fund’s capital to ensure skin in the game. Instead, GP gains management
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