Allan Saunderson is managing editor of Property Finance Europe and a contributor to GlobeSt.com.

LONDON-The European real estate sector has been strongly heartened by the announcement of the US-based private equity group Blackstone that it has made a final closing of Blackstone Real Estate Partners Europe III, targeting equity capital of over €3.1 billion at Europe, in the first instance UK and Germany.

The initial intended target sum was €2.5 billion but the group extended the funding. It said BREP Europe III will target property investments throughout Europe and has commitments from a diversified group of limited partners from around the world. Chad Pike, Co-Head of Blackstone Real Estate, said the capital has been raised from both existing and new investors.

"BREP Europe III is well positioned to take advantage of the inevitable recapitalization of the property sector," he said in a statement. "Given the continued deterioration in the global economy and the lagging nature of the real estate market, we will remain disciplined and cautious in deploying this capital over the coming years."