What is REPE?
Long time lurker here and hopefully I don't get too much monkey shit thrown at me but I had a discussion with guys in my team today as to what REPE actually is and there seems to be quite a bit of confusion/disagreement... I appreciate it really doesn't matter at the end of the day but I was just quite interested in it
For a bit of background, our team is based in the UK (which may result in the different definitions?) and we are in one of the big agencies (CBRE/JLL/C&W/Eastdil etc etc)
General Private Equity Real Estate Fund Structure
My definition of REPE was always:
- GP & LP Structure
- Pooled Capital or Separate Accounts
- Closed-End Funds
- Typical Strategies Value Add+ but I felt Core could be REPE given the first three points
However, opinions differed in the team
- Source of capital cannot be "institutional" ie cannot be pension fund money - otherwise the firm is just a fund manager/institutional investor I disagreed heavily with this because if you take a look at the underlying investors in many, lets say "traditional" PERE firms, the lionshare of backers are public or private pension funds with the odd smattering of foundations/endowments.
- Strategies have to solely be higher end of Value Add+ I disagreed because I would consider Lasalle REPE and they have core funds
- Often has the ability to invest in operational platforms in addition to real estate - example Blackstone delisting a REIT and selling its assets, or a smaller UK REPE firm buying a retirement home operator I disagreed, there are plenty of small shops which I would consider REPE that wouldn't consider such strategies or do not have the capacity.
- GP & LP Structure
- Pooled Capital or Separate Accounts
- Closed-End Funds
I then thought up a small list of firms that I counted as REPE but the common consensus amongst the majority, bar one, discounted the firms noted in *bold* and preferred to class them as just an investment manager/fund manager/institutional investor.
Short List of Real Estate PE firms
- Lasalle Investment Management
- CBRE GI
- Invesco
- Blackstone
- Tristan
- Cerberus
I had a similar conversation with a friend afterwards who is in REPE (His firm only invests in the upper end of Value Add spectrum and beyond) and he said:
- GP & LP Structure
- Pooled Capital or Separate Accounts
- Closed-End Funds
- Value Add+
Who your parent is - ie he would discount any firm who's parent is an insurance company or core money
I had a look on this forum and Jabathehut provided a definition which I would tend to agree with www.wallstreetoasis DOT com/forums/what-is-real-estate-private-equity
I always thought this should be a simple discussion - and maybe I'm/we are being idiots- but I was just wondering if there is a difference in definition in the US, where most of you are based, and here in the UK.
Thoughts?
Recommended Reading
At numquam beatae accusamus qui nesciunt beatae. Impedit labore fugiat voluptas deserunt. Sed molestias asperiores et atque. Quo possimus consequuntur expedita ea ipsam quisquam rerum. Fuga ducimus beatae aut odio odio aspernatur eveniet.
Debitis fugiat esse est atque doloremque in. Quis ea alias rerum earum voluptatem. Consequatur aliquid fuga est illum optio suscipit voluptas aut. Ratione itaque suscipit et.
Aperiam non ducimus facilis. In dicta quo dolorem vel ratione laboriosam perspiciatis. Impedit quisquam maiores deserunt expedita soluta vel.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...