BlackRock Private Markets has raised EUR774 million (USD844 million) in initial investor commitments for the BlackRock Europe Property Fund VI (“EFVI” or the “Fund”) at its first close, with capital provided by a diverse set of global institutional investors, including new clients and LPs from prior vintages.
BlackRock writes that European real estate markets have recently repriced more swiftly than other regions. Amid stabilising interest rates and inflation, EFVI, the latest vintage in BlackRock’s European value-add series, plans to take advantage of this attractive entry point.
The Fund will target the most liquid markets in Europe, with a focus on the UK, France, Germany, the Nordics and Spain; and invest in high-quality assets aligned with the structural “mega forces” driving the economy and future occupier demand. These mega forces include demographic shifts, digital disruption and the transition to a low-carbon economy and a net zero built environment.
The Fund will focus on, amongst others, the need to develop student housing and new residential units, and to provide business-critical logistics and data centre premises in under-supplied markets. As an SFDR Article 8 fund, EFVI aims to create future-proof assets with strong ESG credentials, including high-energy efficiency and pathways to net-zero emissions.
Business plans will focus on recapitalising, repositioning, and rebuilding assets with the BlackRock teams using a hands-on approach to deliver value throughout the life cycle of each investment.
BlackRock’s broad network, extensive research capabilities and on-the-ground presence across European regions creates an ability to source off-market opportunities for its clients – an important source of deal flow across recent vintages. To date, EFVI has already committed EUR289 million of equity across four investments: two logistics assets in Sweden, and multi-family assets and student housing in the UK.
Anne Valentine Andrews, Global Head of Real Estate & Infrastructure at BlackRock says: “The European Value-Add series is a vital component of our USD28 billion global private equity real estate business. Despite continued market uncertainty, the window of opportunity is opening for real estate investors. This requires getting granular within asset classes and harnessing the structural mega forces driving future demand and requirements for real estate. We are pleased to partner with our clients in this latest vintage, delivering local market knowledge and personalized service from BlackRock.”
Thomas Mueller-Borja, Global CIO of Value-Add Real Estate and Co-Portfolio Manager of EFVI, says: “We are delighted to partner with our clients, many of whom have committed to prior EF vintages. Cyclical and structural factors are creating what we believe is the best real estate buying opportunity since 2008. It is crucial to remain disciplined and selective in more volatile times, and we continue to apply the research-led, principle-based investment approach which has consistently guided our decision-making over the years.”
Tatiana Tezel, Co-Portfolio Manager of EFVI, said: “We continue to see attractive opportunities in the European real estate market, particularly as inflation and interest rates stabilise. We have already committed EUR289 million of equity to a range of exciting projects, all of which the team sourced off-market and negotiated attractive entry prices on. We continue to find new opportunities and have developed a diverse pipeline of investments under exclusivity. We’re focusing on fast-growing locations and resilient sectors and developing high quality real estate that meets tenant requirements now and in the future.”