Macquarie raises $1.1b for ‘sheds and beds’ real estate fund

Macquarie Asset Management’s real estate boss Brett Robson says a new multi-billion dollar real estate investment fund will focus primarily on the booming residential and logistics sectors that have benefited from the “global megatrends” of urbanization and digitization.

The investment giant has raised $ 1.1 billion in equity from institutional investors for its new partnership mandated to invest in opportunistic real estate across the Asia-Pacific region, including Australia.

Mr Robson said the partnership’s main investment strategy is twofold: helping specialist operators create or investing assets that meet demand from global megatrends and finding opportunities for higher returns created by “market turmoil” caused by the pandemic are the last 18 months.

“The majority of ours [investment] The focus will be on rental housing and logistics – or beds and sheds, “Robson told The Australian Financial Review. It will be less inclined to invest in office or retail real estate.

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By “beds”, Mr Robson was referring to “the entire rental housing sector,” including college dormitories, co-living housing, purpose-built rental housing (build-to-rent), senior housing and prefabricated housing, he said.

“We have had good experiences in these sectors and we like them all,” he said.

He added that Macquarie’s investment arm is a huge fan of industrial real estate and logistics in particular, having invested in logos and other logistics platforms around the world five years ago.

“We firmly believe in the sector and its prospects. For modern logistics, we see the demand as greater than the supply.

Better return

“We like the development angle where there are better risk-adjusted returns, especially when you’re working with a specialist operator. We think it’s a good place [to invest]”Said Mr. Robson.

The new partnership fund – part of a real estate platform with $ 17 billion ($ 22 billion) in assets under management, including investments in over 500 office, logistics, retail and residential properties – aims to achieve a total return of more than 20 percent .

The fund hopes to do this by investing in specialized platforms, as it has done in the past by supporting Logos, student accommodation provider Igloo, and Greystar Asia Pacific’s build-to-rent business.

“We have already identified a fairly full pipeline of opportunities and expect to get started with investments fairly quickly,” said Robson.

While Macquarie remains “fairly pleased” with its exposure to the office market as a core investment strategy, its mandate to seek higher returns makes it less likely to invest in the sector through its new partnership fund.

“We believe that factors such as higher job rates and good employment growth will support demand for office space, although this will be offset to some extent by the effects of working from home. We think the office is a pretty good investment. “

If Macquarie were to move further into the office sector, Robson said it would most likely be done by investing in a company that is doing “new age, very sustainable” developments in peripheral and suburban markets.

Likewise, he said retail real estate is not a large part of the new fund’s investment strategy unless it has “found the right partner with a good strategy to reposition and transform less-loved retailers”.

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