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Non-Traded REIT Fundraising Bounces Back in March

Non-Traded REITs fundraising bounced back in March with $1.2 billion of investor capital raised, a 156% percent increase over February levels and 11 out of 19 sponsors showing increases in capital formation for the period, according to the latest monthly report by Robert A. Stanger and Co. Inc.

As The DI Wire previously reported in March 2023, Fundraising among non-traded real estate investment trusts in February 2023 sunk to just $489 million, a low not seen since August 2020, while reported monthly redemptions exceeded $1.7 billion, an amount reflecting 351% of fundraising and about 1.6% of reported net asset value for the industry.

For the year-to-date period as of March 31, 2023, aggregate fundraising for the industry equaled $6.3 billion, including $5.2 billion invested in Blackstone’s NAV REIT. Redemption activity for the NAV REIT industry has continued to be robust with redemptions for the quarter estimated at $4.6 billion.

According to Kevin T. Gannon, chairman of Robert A. Stanger & Co. Inc, “The industry deserves a grade of A+ for its commitment to providing liquidity to investors at levels never seen before.”

Stanger’s survey of top sponsors tracks fundraising of all alternative investments offered via the retail pipeline including publicly registered non-traded REITs, non-traded business development companies, interval funds, non-traded preferred stock of traded REITs, Delaware statutory trusts, opportunity zone funds, and other private placement offerings.

Year-to-date 2023 alternative investment fundraising totaled $16.2 billion through March, led by NAV REITs at $6.3 billion, interval funds at $3.9 billion, non-traded BDCs at $2.2 billion and Delaware statutory trusts at $1.4 billion. Blackstone raised $6.0 billion in the alternative investment space year-to-date, including BREIT with $5.2 billion and its perpetual-life BDC, Blackstone Private Credit Fund (“BCRED”), with $871 million. Other year-to-date 2023 top fundraisers are Blue Owl Capital ($1.5 billion) Cliffwater ($1.4 billion), Apollo ($610 million), Ares ($357 million) and Bluerock Capital Markets ($313 million).

Among non-traded REIT sponsors, Blackstone Group leads 2023 fundraising with $5.2 billion, followed by FS Investments with $256.1 million, LaSalle Investment Management ($180.0 million), Starwood ($138.5 million) and Ares Real Estate Group ($122.8 million) round out the list of top 5 fundraising sponsors.

Year-to-date non-traded perpetual-life business development companies have raised more than $2.2 billion, led by Blackstone with $870.8 million raised. Blue Owl with $750.0 million, Apollo ($301.7 million), Brookfield ($204.4 million) and HPS ($107.4 million) round out the list of sponsors surpassing the $100 million mark for the year.

As The DI Wire reported, Blackstone REIT, Starwood REIT and RREEF Property Trust have limited redemptions within the past year while non-traded REITs including Ares Industrial REIT, Ares REIT and JLL Income Property Trust have managed to meet redemptions requests thus far in 2923 through February.

Robert A. Stanger & Co. Inc., founded in 1978, is an investment banking firm specializing in providing investment banking, financial advisory, fairness opinion and asset and securities valuation services to partnerships, real estate investment trusts and real estate advisory and management companies in support of strategic planning and execution, capital formation and financings, mergers, acquisitions, reorganizations, and consolidations.

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