Aldar Properties, Mubadala Investment Company and Ares Management have established a new partnership to jointly invest US$1 billion in private real estate credit opportunities across the United Kingdom and Europe over the next three to five years.
Within this partnership, Mubadala secures a significant 50% ownership in the newly established platform, while Aldar and Ares hold stakes of 30% and 20%, respectively.
Additionally, Aldar will invest US$100 million into an existing European private real estate credit strategy first established by Mubadala and Ares in 2021, which focuses on senior secured debt with a first lien on physical real estate assets, including office, multifamily residential, industrial, retail, and hospitality.
Over time, the Ares European Real Estate Debt strategy is expected to upsize to approximately US$2 billion in capital commitments from Mubadala, Aldar and Ares funds. Including anticipated leverage, the total available capital for the strategy is expected to be in excess of US$5 billion.
Talal Al Dhiyebi, Group Chief Executive Officer of Aldar Properties said: “Private credit is an increasingly important element of real estate finance in mature markets. With the rising prevalence of non-bank lending, as credit conditions tighten and stricter capital requirements are implemented, we see a substantial opportunity for Aldar as a strategic real estate investor. This partnership between Mubadala, Ares, and Aldar is wholly unique, blending financial strength, a proven track record and in-depth knowledge of the real estate sector and asset classes. It is an ideal opportunity in terms of timing to gain both high quality exposure to a key asset class and a solid foothold in a market that is not only scalable but that also offers favourable risk-adjusted returns through market cycles.”
Commenting on the launch of the new platform, Omar Eraiqaat, Deputy CEO of Disruptive Investments at Mubadala, said: “Mubadala has strong and strategic relationships with both Ares and Aldar, and this new platform leverages the collective strengths of each party to invest in the private real estate credit market in the United Kingdom and Europe. This collaborative approach reflects our shared commitment to identifying and capitalizing on unique investment opportunities that deliver sustainable, long-term returns.”
Phil Moore, Partner and Head of European Real Estate Debt in Ares Real Estate, said: “The global opportunity for flexible private real estate lenders continues to grow as we see ongoing retrenchment of traditional sources of capital. We remain focused on leveraging our cycle-tested team, global market perspective and disciplined approach to capitalize on our high conviction sectors, including the residential, mixed-use and adjacent spaces, all of which continue to benefit from attractive supply/demand dynamics. Our most recent investments reflect our ability to step into complex situations and provide flexibility up and down the risk/return spectrum at scale. We look forward to further pursuing attractive lending opportunities and executing on our debt investment strategy in Europe alongside Mubadala and Aldar.”
The announcement follows Aldar’s recent expansion into the UK with the acquisition of London Square, the company’s inaugural direct investment beyond the MENA region.
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