Hines, the global real estate firm, raised c. €900 million of equity from institutional investors at the first closing of its new value-add fund, Hines European Value Fund 3 (HEVF 3).
A group of 15 investors, predominantly existing investors in the successful series, joined this first closing in which their subscriptions amount to c. 60 percent of the € 1.5 billion targeted equity commitments Hines is seeking for HEVF 3. Further closings are expected through 2022, and into early 2023 as required. Hines expects the European investor group in this first closing to be joined by new and existing US, Asian and Middle Eastern partners in subsequent closings.
HEVF 3 is targeted to be the largest fund in the HEVF series to date, following its predecessor 2018 and 2020 vintage funds in the series. It will complement Hines’ other flagship European funds, the open-ended core-plus Hines European Property Partners (HEPP) and Hines European Core Fund (HECF).
HEVF 3 will once again build from the consistent principles of the series: high conviction thematic investment into tactical opportunities for value creation, supported by fundamental trends and capital markets inefficiencies. Hines focuses on applying its in-house real estate skillset to actively create value at the asset level, in strong locations within Europe’s primary institutional markets. It will diversify across markets, sectors, and risk profiles. The fund has already secured control of two separate deals in the logistics and residential sectors.
Alex Knapp, CIO – Europe at Hines, commented: “To attract this level of capital to our third value-add fund despite market uncertainty and cloudy macroeconomic conditions is a testament to the strength of our team. It means we have raised c. €2 billion in discretionary equity in the first half of 2022 across our suite of European flagship funds. Our Hines European Core Fund (HECF) has secured equity commitments of c.€300 million, our recently launched core-plus fund – Hines European Property Partners (HEPP) – raised c.€800 million at the first close, and this, our Hines European Value Fund 3 (HEVF 3) rounds off a highly successful few months for our investment management platform in Europe.”
Paul White, fund manager for the HEVF Series, said: “The last two years have changed what real estate stock is needed; where and with what characteristics. For a value-add fund with an active strategy like ours, disruption is an opportunity. We’re intending to take conviction positions on the best value opportunities in Europe, wherever they migrate to in the current more volatile context. Our local teams act as our antennae, ready to respond in real-time and faster than lagging capital markets to both accelerated obsolescence and surging demand. Most importantly, we will pursue market-leading ESG aspirations at the heart of every investment.”
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