Hines Acquisitions
Appreciate any insight people can provide on what day to day would be like in a regional role where you are designated to specifically work on acquisitions, not acquisition + development, which is what most of my front office Hines contacts represent they do, with a big bias toward development.
I saw they raised a billion for a new fund and are fundraising a few others. Fundraise is solid, but not spectacular compared to headlines coming out of other firms this past year. Does Hines plan to become a big player in the space? What does volume look like for next year? What % of equity is Hines and will they invest in non-Hines sponsors? Their website explicitly says they do value add in Europe, will they do it in America?
if you feel more comfortable PMing me please do so
I think most of their true acquisition guys from their fund is based out of Houston, but think they changed their model so that local teams do both acq and dev. Don’t think any local office with guys only do acq, think it’s that acq and dev balance with heavily weighted on dev since it takes more time to execute the business plan….but any Hines people correct me if I’m wrong
Thanks. My understanding is similar to yours, but they have a posting right now for an associate just focused on acquisitions for a region. Not sure what to make of it
Depends on how busy the market is. Regional offices tend to have their own dedicated acquisitions teams, focused solely on new business. These essentially act as boots on the ground for their funds based in Houston/London, whilst also sourcing deals for external capital. If the market is quite small with not a lot of deals, there will be less of a need for a dedicated acquisitions team and they will cross over with the development side on occasion.
Not to hijack the thread, but I'm curious if anyone has any insight on WLB for regional deal teams? I scoured the forums and the only thing I found was that Hines analysts work '60-80 hours per week' which seems heavy relative to the pay.
70-80% of weeks are at the 55-65 hour range, and when there’s multiple deals that need to cross the line it’ll rise towards 70-80 hours max
Coming from experience? Thanks btw
This sounds like it will be a us value add fund:
https://www.bizjournals.com/houston/news/2022/01/10/hines-investment-fu…
Not to shit on $1B but that fund seems small for a group like Hines
Why does Hines invest so heavily in Houston? Seems really levered to energy.
This is a good question. I just left houston and I’m not sure why anyone would be investing big money there right now.
The perception of Houston tied to energy is a bit of a misnomer in 2022. There are definitely product types to stay away from, like office, but the Houston market has some of the best opportunity in the country. Especially for ground up development.
I don’t think Hines actually “invests” a ton in Houston per se (at least as of late). The reason they have such a large presence in the city is more so related to the firm’s history. Meaning, Gerald Hines really built up the company there and ever since the company has left it’s roots there. Some of Hines’ first huge projects were in Houston.
While real estate is definitely a local business, that’s why their satellite office model works for them.
May be something to do with the fact the Hines HQ is in Houston..
Did you end up applying? Can give you a rundown
No idea about the US, but in Europe local offices do most of the job (the European office is in charge of monitoring the deals, but they don't really do much).
Also yes, local offices do have dedicated acquisition teams. WLB is pretty hard and pay is not that great in my opinion, but progression can be really fast and you learn a lot.
On fund raising, you need to keep in mind that Hines usually rely on one-off JVs. They are raising more and more capital in decidated funds (like the one mentioned in the comments) and thus they don't really shine on the REPE tables. Happy to reply to any questions.
Are the two $1B funds raised going to be taking down the full equity stack? Or could it go farther as it will only be Hines' normal share of the stack in development deals (5-10%)
To add to this, the local offices originate the deals. They bring new deals to a European region wide call and it gets allocated to one of the various funds / SMAs / one-off investors they think it's a good fit for. Local offices lead the acquisition process but a handful of different groups from London may also be involved (fund management, finance / tax, legal etc) if it's allocated to a Hines fund
On the point on JVs, these can be the size of what would be a decent fund for other firms. Some examples include Quadreal European Living JV (€500M equity) or the NPS Global Build-to-Core JV ($1.25BN equity).
Totally agree on this. I would also add that from what I see Hines is undergoing a process of remarkable growth (at least in Europe), with a strong focus on build-to-rent and student housing.
Not sure if I understood your question.
Anyway, generally Hines (family & senior management) co-invest along with the LP. The equity subscribed for the Hines-backed fund will not be used for the co-investment share, so in the equity position you will have X% of Hines capital and 1-X% of Hines-backed fund
No you understood right, thank you. $1B not as much firepower as I would've expected...
If this is a GP fund, $1B equity fund could be equivalent to $57B+ in AUM. ($1B at 5% equity stack = $20B total equity; levered at 65% = $57B).
EDIT: I was not stating this new fund from Hines is a GP fund; was using BOE math to show that a small GP investment can be put into a lot of deals. If this is true LP equity, $1B does feel small to me for a group like Hines.
OP, did you ever get more details on this/the role? Feel free to PM me.
Are you connected to the firm/role or are you also looking for info?
Not connected, just looking for more info.
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