North American property funds dominate 2Q fundraising
North America property funds accounted for most of the $11.2 billion raised by private equity funds with a final close in the second quarter of 2011, according to research firm Preqin. Total commitments were up on the $8.9 billion raised in the first quarter and the $7.1 billion raised in the last three months of 2010.
Lone Star Real Estate Fund II led the way with a $5.5 billion final close, while Och-Ziff Real Estate Fund II took in $840 million and Pramerica Real Estate Capital I raised $786.5 million.
Looking at the industry as a whole, 10 funds with a primary focus on North America attracted a collective $8.6 billion, with three European funds attracting $1.2 billion. Five Asia and rest-of-the-world funds received commitments totaling $1.4 billion.
"As deal levels increase and, as a result, more distributions occur, investors will have more capital available to make new commitments, which is likely to further improve fundraising," said Andrew Moylan, Preqin's manager of real estate data. But he added that the improvement would be gradual, warning that many firms face long periods in the market and others will be forced to abandon fundraising efforts.
Preqin has previously said it expects global private equity fundraising to reach $300 billion this year, with 220 firms having secured $110 billion since January. Warburg Pincus is reportedly preparing a new buyout fund that could be worth $12 billion, and the likes of KKR and Apax Partners also have new vehicles in the pipeline.
Private equity firms raised $225 billion in 2010, the lowest amount six years.
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