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Amount of Capital Chasing Real Estate Increases

NEW YORK CITY-Real estate private-equity funds held $17.5 billion of capital to invest through the end of 2004, and they expect to raise an additional $18 billion this year, according to a new survey.

By Barbara Jarvie | Updated on November 17, 2005

(To read more on the debt and equity markets, click here.)

NEW YORK CITY-Fundraising in the real estate private equity fund market is on track to have a successful year again, according to a survey of 60 US-based fund sponsors–representing more than 175 individual funds–conducted by Ernst & Young LLP. Existing real estate private equity funds held $17.5 billion of capital to invest from funds raised through the end of 2004. They expected to raise an additional $18 billion this year.

Gary Koster, leader of Ernst & Young’s Real Estate Private Equity Services Practice in the Americas, tells GlobeSt.com that the trend shows no sign of slowing. “I don’t have a crystal ball, but I don’t think so.” The survey indicates the sector will have well over $100 billion of leveraged purchasing power for new acquisitions heading into 2006.

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