Jumping on the Bandwagon, LaSalle Forms Partnership to Capitalize on Discounted Real Estate
- Sep 25, 2009
Chicago–As expected, price tags on commercial real estate around the world are dropping and LaSalle Investment Management is among the minority presently in a position to take advantage of bargains, the likes of which may not be seen again in decades. The Chicago-based firm has just formed a fund with the Austin-headquartered Teachers Retirement System of Texas to invest an initial sum of $205 million in real estate across North America.
LaSalle and TRS will establish partnerships with private equity concerns for co-investment with the fund. At the outset, those alliances will center on general partnership fund managers that have existing relationships with TRS, and will focus on macro-level strategies for the first two or three years. “We have a long history of successfully working with numerous partners on a wide array of real estate investments,” Dan Witte, Managing Director, LaSalle Investment Management, noted in a prepared statement. “We believe that this capital–flexible, efficient and market-sensitive–will be well-received by potential partners today.”
The fund, to be managed by LaSalle, will seek to create a diversified portfolio of various property types, first targeting selected markets in North America, with plans to expand to global opportunities.
With a multi-billion-dollar pool of assets carrying debts nearing maturity, various funds are popping up to take advantage of the plummeting prices on these distressed properties. Recently, Toronto-based Brookfield Asset Management and Brookfield Properties Corp. announced the launch of a $4 billion investor consortium to invest in equity and debt in undervalued real estate companies and portfolios around the world. In July, Boston-based closed real estate investment firm Marcus Partners closed Marcus Capital Partners Fund I with $210 million in capital commitments to invest in office, bio-medical, medical office and light industrial properties in major metropolitan areas primarily east of the Mississippi River.