(LONDON) – Hines, the global real estate firm, is set to launch Hines European Value Fund 3 (HEVF 3), expected to be its largest closed-end fund to date in its growing flagship series of value-add funds in Europe, targeting equity commitments of approximately €1.5 billion.
HEVF 3 intends to build on Hines’ principles of value-add investing applied across the fund series so far – high conviction thematic investment into tactical opportunities for value creation, supported by fundamental trends and capital markets inefficiencies. Hines will adopt an approach of confining investment of HEVF 3 to what it considers to be the most liquid, institutional set of primary markets in Europe and applying its in-house real estate skillset to actively create value at the asset level.
HEVF 3 will seek to build a portfolio diversified by markets, sectors and risk profiles, and is expected to have dominant allocations to logistics and office. The first closing of HEVF 3 is expected to take place in early-Q2, with further commitments to follow throughout 2022.
HEVF 3 will also pursue market-leading sustainability credentials, embracing GRESB, the leading ESG benchmark for real estate and infrastructure investments across the world. It will build on the success of its predecessor, Hines European Value Fund 2 (HEVF 2), which, in 2021, was awarded five green stars out of five and lauded with several accolades such as the Overall Global Sector Sustainability Leader.
In Europe, Hines continues to expand, with approximately 650 employees across 13 countries in the region and a total AUM of €21.7bn*. Hines marked its 65th anniversary in February this year with the appointment of Laura Hines-Pierce as Co-CEO, one of the few female CEOs in real estate globally.
Paul White, fund manager for the HEVF Series, said:
“The pace of fundraising and execution of investments in our first two European value-add funds has led to considerable anticipation ahead of the launch of HEVF 3. Following the successful formula for thematic investment strategies and off-market origination of its predecessors, this third fund is anticipated to be the largest to date in terms of equity commitments, and also intends to set a new benchmark of aspiration for ESG performance. We will really push to leap ahead of the market in this critical area. We also believe the strength of our local teams in each country we operate in, provides us with an unusually strong competitive advantage today.”
Alex Knapp, CIO – Europe at Hines, added:
“As we continue the expansion of our European investment platform, this third installment of our flagship value-add series will once again apply our conviction approach to diversified European portfolio construction. We are very proud of the investment performance demonstrated by the first two HEVF vintages. Our in-house execution platform spanning 16 local market offices has been tremendously responsive in pipeline generation for our favored investment themes – with particular success in off-market origination. We look forward to what’s next for our European funds comprising HEVF 3 alongside our Hines European Core Fund and our new Hines European Property Partners core-plus strategy.”
*data correct as of 06.30.21
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About Hines
Hines is a privately owned global real estate investment firm founded in 1957 with a presence in 255 cities in 27 countries. Hines oversees investment assets under management valued at approximately $83.6 billionÂą. In addition, Hines provides third-party property-level services to more than 367 properties totaling 138.3 million square feet. Historically, Hines has developed, redeveloped or acquired approximately 1,486 properties, totaling over 492 million square feet. The firm has more than 171 developments currently underway around the world. With extensive experience in investments across the risk spectrum and all property types, and a foundational commitment to ESG, Hines is one of the largest and most-respected real estate organizations in the world.
Since entering Europe in 1991, Hines has grown its European platform to include offices in 16 cities as well as a presence in 62 cities in 13 countries. Hines oversees investment assets under management valued at approximately €21.7 billion and provides third-party property-level services totaling 3.9 million square meters in Europe, in Austria, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Poland, Spain and the United Kingdom.
Visit www.hines.com for more information.
1. Includes both the global Hines organization as well as RIA AUM as of 30 June 2021.
About the Hines European Value Fund (HEVF 1)
HEVF 1 was the first fund in the flagship HEVF Series, with the objective to secure and invest in value-add commercial real estate throughout Europe on behalf of an institutional investor group. HEVF 1 is a closed ended Euro-denominated, Luxembourg-based investment fund which launched in July 2017. It held its final close in 2018 and the total fund size exceeded €720 million of equity commitments, surpassing its original target by more than 40 percent. HEVF 1 successfully secured 9 investments across Europe and is now focused on execution and disposition of these assets, with the anticipation that the Fund will outperform its target returns. The flagship HEVF Series for Hines in Europe has a geographic mandate across the European Union (plus the UK and Norway) and has the flexibility to invest in logistics, living, office, retail and mixed-use opportunities in institutional markets.
About the Hines European Value Fund 2 (HEVF 2)
HEVF 2 is the second close-ended, Luxembourg-based investment fund in the flagship HEVF Series with the objective to secure and invest in value-add commercial real estate throughout Europe on behalf of an institutional investor group. HEVF 2 was initially launched in December 2019 and has effectively been fully allocated across 14 separate investments across the Residential, Logistics and Office sectors. Execution and crystallization of performance is the focus and currently the fund expects to outperform its target returns.
About the Hines European Value Fund 3 (HEVF 3)
HEVF 3 will be a euro-denominated, Luxembourg-based close-ended investment fund targeting an initial launch in April 2022. Managed by Hines, its objective is to acquire a portfolio of value-add profile commercial and residential real estate investments throughout the major European markets on behalf of an institutional investor group. Whilst the fund has broad flexibility across all sectors, the portfolio is largely focused on Logistics, Office and Residential usages.
HEVF 3 follows its predecessors HEVF 1 (2017 vintage) and HEVF 2 (2020 vintage) in continuing the flagship HEVF Series for Hines in Europe, alongside the Hines European Core Fund (HECF) open-ended core flagship vehicle, and the new open-ended core-plus European real estate fund, Hines European Property Partners (HEPP).
About Hines European Core Fund (HECF)
The HECF was set up in 2006 with the aim of providing investors with a resilient income profile and benchmark’s outperformance, derived from a diversified portfolio of high-quality assets located in prime locations across major European cities. As of Q4 2021 the HECF portfolio was 97% occupied with an aggregate fund value of c.€2.8bn. The portfolio of the Fund comprised 35 assets including forward commitments, invested in 16 city markets across ten different European countries.
About Hines European Property Partners (HEPP)
HEPP is a diversified open-ended core-plus fund focused on key European markets. HEPP will leverage Hines’ expertise and boots on the ground presence in 16 offices across Europe to identify investment opportunities in Europe’s most dynamic urban centers and gateway cities. The Fund will seek to acquire and develop sustainable assets across a range of sectors including logistics, office, living – residential, student and senior housing. HEPP will launch in Q2 2022 and aims to attract €1bn in investor equity to the strategy in the first 12 months from launch.
