BlackRock Private Markets has announced the first close of the BlackRock Europe Property Fund VI, the latest vintage in BlackRock’s European value-add series, with initial investor commitments of €774 million.
BlackRock identifies the current European real estate landscape as the most promising buying opportunity since 2008.
Highlighting the swift repricing of European real estate markets compared to other regions, BlackRock plans to leverage this trend amid stabilizing interest rates and inflation. The fund aims to capitalize on what it considers an “attractive entry point” in the market. It will focus on the most liquid markets in Europe, particularly targeting the UK, France, Germany, the Nordics, and Spain.
The fund’s investment strategy revolves around high-quality assets aligned with key structural forces driving the economy and future occupier demand. These forces include demographic shifts, digital disruption, and the transition to a low-carbon economy with a focus on creating a net-zero built environment.
BlackRock’s emphasis within the fund will be on student housing and homes, as well as logistics and data centers in under-supplied markets. Adhering to SFDR Article 8 standards, the fund will prioritize ESG credentials, emphasizing high energy efficiency and net-zero emissions.
Strategic objectives for the fund encompass recapitalizing, repositioning, and rebuilding assets. As of now, the BlackRock Europe Property Fund VI has already allocated €289 million of equity across four investments. This includes the acquisition of two logistics assets in Sweden and investments in multi-family assets and student housing in the UK.
Anne Valentine Andrews, Global Head of Real Estate and Infrastructure at BlackRock, emphasized the significance of the European Value-Add series within their global private equity real estate business. Despite market uncertainties, BlackRock sees a window of opportunity for real estate investors by focusing on asset classes and aligning with structural mega forces driving future demand.
Thomas Mueller-Borja, Global CIO of Value-Add Real Estate and Co-Portfolio Manager of EFVI, stressed the importance of remaining disciplined and selective in volatile times. He highlighted the cyclical and structural factors contributing to what BlackRock believes is the most favorable real estate buying opportunity since 2008.
As of September 30, 2023, BlackRock manages US$317 billion in alternative investments and commitments globally on behalf of its clients.
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