Global Real Estate AUM Increased 11.8% to US$2.8 Trillion In 2017
Total global real estate assets under management (AUM) rose from US$2.5 trillion at the end of 2016 to US$2.8 trillion by the end of 2017, with fund managers of all sizes increasing the value of their assets, according to the Fund Manager Survey 2018 conducted by ANREV, INREV and NCREIF. The average AUM among all managers increased by 22.2% in 2017 from US$14.4 billion to US$17.6 billion. The top five managers posted real estate assets under management of more than US$100 billion each.
The Blackstone Group once again topped the overall rankings with US$193.8 billion in real estate-related AUM, followed by Brookfield Asset Management in second place with US$155.5 billion and PGIM in third position with US$127.9 billion. CapitaLand Limited again dominated the list of Asia Pacific managers, topping the list for the second consecutive year with its AUM totaling US$61.3 billion, followed by Mapletree Investments with US$32.3 billion and ARA Asset Management with US$26.4 billion. Overall, the AUM of the top three managers in Asia Pacific increased by nearly 35% during 2017.
By regional strategy, 16.9% of total global real estate assets were invested in Asia Pacific, compared with 33.8% in Europe, 36.9% in North America, 11.9% in global strategies, 0.6% in South America and 0.05% in Africa, a very similar geographic split to last year.
Non-listed real estate vehicles – including funds, separate accounts, joint ventures and club deals – accounted for US$2.4 trillion (83.3%) of all real estate AUM globally. In Asia Pacific, the majority of assets continued to be invested in non-listed funds and private REITs, with 59.0% invested in these vehicles. This was followed by separate accounts (direct), which made up 17.4% of the region’s total AUM. This trend was broadly mirrored in other regions, with non-listed real estate funds and private REITs accounting for 55.1% of European AUM and 47.6% in North America.
Non-listed real estate funds by themselves represented 45.5% of total global AUM. Per region, they represented 39.6% of total Asia Pacific AUM, 40.2% of total North America AUM, 51.3% of total Europe AUM and 51% of global strategies.
The survey still points to a consolidation trend in the industry with almost a quarter of respondents in the global survey saying they had been involved in M&A transactions over the past decade.
Amélie Delaunay, Director of Research and Professional Standards at ANREV, commented, “Real Estate assets under management continue to increase for all fund managers, reflecting the attractiveness of real estate as an asset class for investors. The big managers also continue to get bigger, with US$100 billion in AUM now needed to make it into the top five.”