Benson raises €500m for real estate

Private equity real estate firm Benson Elliot Capital Management has closed its second pan European fund Benson Elliot Real Estate Partners III on €510m, against a target of €500m.

Benson Elliot launched fundraising for BEREP III in the third quarter of 2008, closing almost 90% of its target capital in ten weeks. BEREP III will invest in a range of performing and non-performing real estate assets across Europe.

The firm decided to cap BEREP III at a level approximately 50% larger than the company’s previous fund, BEREP II. Subscribers to the fund comprise institutional investors from Europe, North America and Asia, including corporate pension funds, endowments, foundations and family offices. All but one of Benson Elliot’s BEREP II investors subscribed to the latest fund.

Makena Capital Management, The State Teachers Retirement System of Ohio and UTIMCO are among the lead investors.

To date, BEREP II has invested approximately €150m in six European countries, with 70% of the capital invested in France and Germany. Following the closing of BEREP III, Benson Elliot has access to over US$600m of discretionary equity and buying power of up to €2bn.

Managing partner Marc Mogull said: “The next few years will offer a once in a generation opportunity for savvy investors to buy great assets, in major markets like the UK and Germany, on sensible terms. I can only say this is an especially exciting time to have a strong platform, an experienced team, a supportive investor base and a sizeable pool of discretionary equity.”

Fund placement firm Probitas Partners served as BEREP III’s placement agent. Legal advice was provided by Travers Smith and Proskauer Rose, and structuring advice was provided by Deloitte.

Distressed debt is one of the few areas where funds are being raised and beating their targets. For 2009, Preqin estimates that there are 38 funds, seeking an aggregate of US27.3bn, waiting to be deployed.