Urban Partners raises €3.6bn for NREP value-add real estate fund

Urban Partners raises €3.6bn for NREP fund, largest ever European value-add real estate fund

Urban Partners has raised €3.65 billion for investments by its Northern European real estate business, NREP.

In the face of a challenging global fundraising environment, the fund NSF V attracted unprecedented investor demand, making it the largest European focused value-add real estate fund to date, thanks to NREP’s proven strategies, pipeline, geographical focus and ESG leadership.

Urban Partners, which has €20 billion in assets under management, is a new umbrella platform housing real estate investor NREP, venture capital firm 2150, credit platform Velo Capital, and private equity investor Luma Equity. Urban Partners will use a combination of constructive capital and the expertise from its various financial arms to invest in projects that respond to the social, economic, health, and environmental challenges faced by cities.

The new Fund is the fifth and largest vintage in the NSF value-add series and the vast majority of the commitments to the Fund came from existing Urban Partners investors, with the total investor make-up being globally diversified, predominantly comprising pension funds, insurance companies, and sovereign wealth funds. The Fund was significantly oversubscribed and had an aggregate demand from investors exceeding €4.2 billion.

Claus Mathisen, CEO, Urban Partners, said: “The phenomenal support generated for NSF V in the context of a fragile economic climate, is testament to the track record of its predecessors and an endorsement of Urban Partners’ ambition to transform the green credentials of cities and make them more liveable. With NREP, we have proven the commercial upside of being a change-maker for almost two decades, with spearheading initiatives when it co­mes to both decarbonising solutions and addressing societal challenges.”

Through NSF V, NREP invests to address underserved real estate segments across the Nordics and selected Northern European markets. The focus is on residential rental properties, modern logistics facilities, care homes and offices, where the company can create value through customer-centric and decarbonising solutions. NSF V will leverage NREP’s proven capabilities in segments supported by strong structural tailwinds, taking advantage of the business’ deep local presence and experience to source opportunities within its strategic segments.

Rune Kock, CEO, NREP, said: “The significant scale of NSF V enables NREP to make a meaningful impact through our focus on customer-centric and decarbonising ­real estate strategies, and set a positive example for the industry to follow and ultimately scale. By focusing on structurally supported sectors and demographically driven trends, we have the proven ability to create value across cycles whilst demonstrating the commercial viability of brown to green real estate transition strategies. In the context of recent global macroeconomic disruption, we expect to be in a uniquely competitive position as attractive opportunities arise and markets stabilise, particularly when combining NSF V’s investment capacity with our open-ended fund, which is also actively deploying.”

NSF V has a substantial qualified pipeline and has already committed approximately one-third of its capital. The so far 33 investments include the Vällingby Centrum project in Stockholm, the historic commercial centre forming the basis of the widely replicated 15-minute city, which was acquired with an environmental and social sustainability-focused enhancement strategy; the initial homes for OsloBolig, a unique third housing sector coalition with Oslo Municipality and other partners, and; the Eteläesplanadi 2 office building in Helsinki, where NREP will undertake an ESG-focused refurbishment and install its flexible workspace concept.

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