- Sees CP V moving into harvest mode next year
- Books nearly $500M profit on 650 Madison Ave
- NGP targeting $4B for 11th fund
The Washington-based private equity firm, which has $185 billion in assets under management, said it expects to move into harvest mode in 2014 for the vintage 2007 Carlyle Partners V LP fund, which raised $13.7 billion. Last week on its third-quarter earnings call, Carlyle said Carlyle Partners VI is nearing the $13 billion mark, ahead of its $10 billion target.
David Rubenstein, co-CEO of Carlyle Group, said the firm continues to diversify as an alternative asset manager with a global footprint — not just a private equity firm — as it positions itself to woo high-net-worth individuals seeking returns in a flat interest-rate environment.
To boost its money-management business, Carlyle acquired the remaining 40 percent of fund-of-funds manager AlpInvest over the summer and also acquired Metropolitan Real Estate. The firm expanded its structured credit, hedge fund and business development corporation holding under its GMS unit. It’s also working to expand its offerings to retail investors, and play a leading role in the business of collateralized debt obligations.
On the fundraising front, Carlyle now employs about 80 professionals, up from 36 in March, 2011, to face an environment in which allocations to private equity are increasing, but raising money takes longer and requires more individualized attention, Rubenstein said.
Looking ahead at investment opportunities, Carlyle Group highlighted the energy sector, where it said $37 trillion in cumulative investment is needed by 2035 for global supply.
While Carlyle still holds an interest in funds it launched with Riverstone Holdings LLC, the firms separated officially back in 2011. The firm’s new natural resources platform is headed by Ken Hersh for North America Energy, and Marcel van Poecke for international energy. Hersh is also co-founder of NGP Energy Capital Management, the Irving, Texas-based energy infrastructure specialist that Carlyle bought into last year with an investment of $424 million.
NGP’s 11th North American energy buyout fund, NGP Natural Resource XI, LP, will target $4 billion. Carlyle’s new international energy fund will raise $1.5 billion, and its North American Power unit — led by Bob Mancini, formerly of Goldman Sachs and Matt O’Connor, formerly of General Electric Co — plans to raise $1.5 billion.
On the real estate front, Carlyle said it’s planning to raise $3.5 billion for its seventh real estate fund, up from $2.3 billion for its predecessor.
Carlyle said it sold 650 Madison Ave for $1.3 billion after investing $810 million in the property. Carlyle Realty Partners V, a $3 billion opportunistic U.S. real estate fund, invested in the New York City address in 2008. It was sold to Crown Acquisitions and Highgate in a deal announced in June.
Co-CEO William Conway Jr. said the firm isn’t interested in social media firms, or in seeding the next Facebook or Twitter.