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NEW YORK CITY-Morgan Stanley has collected $8 billion of equity commitments for its MSREF VI International Fund, making it the world's largest real estate fund. The equity has come from across North America, Europe, the Middle East and Asia. Morgan Stanley has invested just over 20% of the total equity raised.
MSREF VI International has buying power over $30 billion, and uses an enhanced return strategy. Current investments has been outside the US, split between developed markets like Japan, Western Europe and Australia, and emerging markets, like China, India, Russia, Turkey and Latin America.
"The record size of this fund, both for Morgan Stanley Real Estate and among real estate investment managers, is indicative of strong capital flows into real estate as new investors seek exposure to the asset class and existing investors increase their allocations," says John Carrafiell, managing director and global co-head of Morgan Stanley Real Estate Investing.
"Real estate is increasingly becoming an important component of an asset allocation strategy," he says, "It offers portfolio diversification and the ability to invest in 'real' assets, which provide uncorrelated investment returns compared to other asset classes."
"We believe that attractive opportunities to invest in real estate around the globe will continue as demand for all asset types outpaces supply," says Sonny Kalsi, managing director and global co-head of the division. "Global employment growth, an aging population in the west, a growing population in the east and accelerating urbanization in many emerging markets will drive the need for all types of quality real estate."
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