Top 10 managers globally reached €1.9 trillion AUM (€1.8 trillion in 2022)
29 May 2024, Amsterdam – Total global real estate assets under management (AUM) fell to €3.7 trillion[1] in 2023, a 3.8% decline from the €3.9 trillion reported at the end of 2022, according to the Fund Manager Survey 2024, published today by ANREV, INREV and NCREIF.
The decrease marks a second consecutive year of contraction for the global non-listed real estate industry, following the peak of €4.1 trillion that it reached in 2021. This decline is reflective of falling values driven by the high interest rate environment and historic low levels of capital raising activity, which totalled a minimum of only €117 billion[2] in 2023.
However, at the fund manager level, the data show an increase in average AUM. This rose to €38.8 billion in 2023 – up by 12.8% on the €34.0 billion reported at the end of 2022. This confirms an on-going concentration of capital among the larger fund managers globally, with scale and track record playing an even more important role in the challenging market conditions as investors seek to play safe.
Top 10 reshuffle
There was a reshuffle of the top 10 fund managers globally, most notably among the largest five managers. Blackstone, Brookfield Asset Management, and Prologis retained the first second and third positions in the rankings, respectively. They were followed by Metlife Investment Management and UBS Asset Management in fourth and fifth place, respectively.
Following the acquisition of Credit Suisse, UBS Asset Management returned to the top 10 as the only new entrant on this list in 2023. ESR was the only Asian Pacific fund manager to make it into the top 10 this year.
Total AUM for the top 10 fund managers globally reached €1.9 trillion at the end of 2023. Average AUM per fund manager hit €189.6 billion – up from €182.5 billion in 2022.
In order of rankings, ESR, GLP, and CapitaLand Investment Limited topped the list of managers in Asia Pacific. For CapitaLand Investment Limited, 2023 marked its eighth consecutive year in the top 10. Dexus and the GPT Group were the new entries to the top 10 managers in Asia Pacific in 2023.
UBS Asset Management took the top spot in Europe, doubling its AUM from €48.2 billion in 2022 to €94.4 billion in 2023. This is largely due to the acquisition of Credit Suisse. Swiss Life Asset Management and Blackstone were in second and third place, respectively, as was the case in 2022 Patrizia and DWS moved up in the European rankings this year into respective sixth and eighth place.
Blackstone retained its position at the top of the list of North American fund managers with an AUM of €241.6 billion in 2023. This leaves a €44.1 billion gap in AUM to Prologis in second place. MetLife Investment Management was third. Blackstone is the only fund manager to feature in the top 10 in all three regions (Asia Pacific, Europe and North America), as well as for global strategies.
Dry powder steady at 8.0% of global AUM
Dry powder[3] stood at €223 billion – 8.0% of total global fund manager AUM. This is a €10 billion – or 26 basis points – year-on-year increase on the 7.8% of 2022. Dry powder is highly concentrated in the upper quartile of fund managers by global real estate AUM, with €178 billion (8.1% of the upper quartile AUM) of the €223 billion, an increase from €163 billion equivalent (7.2%) in 2022.
At €6 billion, dry powder levels of fund managers in the lower quartile were only slightly lower in 2023, leaving this relatively small group with a 20.2% dry powder quota of the respective AUM. This aligns with the slight increase in concentration in the lower quartile, indicating the rise of smaller niche players leveraging their unique specialist offerings.
No major changes in sources of capital
Pension funds and insurance companies continue to serve as the primary sources of equity for global real estate, collectively representing 59% of the total capital allocated to the asset class. At a global level, there were no major shifts in sources of capital, with 2023 seeing a continuation of trends that started in 2022 or earlier.
Sovereign wealth funds, however, experienced a small decrease in their global contribution to the real estate market, accounting for 8.5% of the global capital flows in 2023 (9.1% in 2022). This was largely due to their reduced activity in the Asia Pacific market, from 21% in 2022 to only 17% last year. Instead, the region saw a notable increase in interest from government institutions, as their share tripled from 2.2% in 2022 to 6.3% at the 2023 year-end.
Iryna Pylypchuk, INREV’s Director of Research and Market Information, said: “The latest results indicate a moderate decline of total global real estate AUM, albeit with interesting ‘growth pockets’ amongst larger fund managers and those smaller niche players taking advantage of their specialist proposition.
“Meanwhile, the substantial amount of dry powder (€223 billion, 8.0% of the global AUM) could lead to a rapid uptick in investment flows as the gap between willing buyers and sellers continues to shrink. Equally striking is that only European fund managers anticipate corporate merger and acquisition activity in 2024.”
– Ends –
For further information, please contact:
Johlyn da Prato, johlyn.daprato@inrev.org | +31(0) 621397456
Justin St Clair-Charles, inrevteam@firstlightpr.com | +44 (0) 7769 644 059
Ellie Rust, inrevteam@firstlightpr.com | +44 (0) 7860 650 103
Notes to Editors
About the Fund Manager Survey 2024
The ANREV / INREV / NCREIF Fund Manager Survey explores real estate assets under management, providing insights into regional compositions and vehicle types.
This year’s survey includes 96 managers and represents total real estate assets under management of €3.7 trillion as at end 2023.
The survey was launched in 2011 and was expanded to include global coverage in 2015. Results are based on data provided directly to ANREV, INREV and NCREIF by managers.
About INREV
INREV, the European Association for Investors in Non-Listed Real Estate Vehicles, was launched in May 2003 as a forum for institutional investors and other participants in the growing non-listed real estate vehicles sector.
INREV has 496 members, which include 128 of the largest institutional investors. INREV members deliver €385 billion of stimulus to the real economy of Europe.
The non-profit association is focused on increasing the transparency and accessibility of non-listed vehicles, promoting professionalism and best practice, and sharing knowledge. It is based in Amsterdam, the Netherlands.
About ANREV
ANREV is the Asian Association for Investors in Non-Listed Real Estate Vehicles, a not-for-profit organisation based in Hong Kong. ANREV's agenda is driven by the members, in particular the investors, and is focused on improving transparency and accessibility of market information, promoting professionalism and best practices, sharing and spreading knowledge. Fund managers, investment banks, lawyers and other advisors provide support in addressing key issues facing the Asian non-listed private equity real estate fund markets.
ANREV is a sister organisation to INREV in Europe and works with a number of other associations across Asia-Pacific and North America on research and professional standards. http://www.anrev.org.
About NCREIF
Based in Chicago, the National Council of Real Estate Investment Fiduciaries (NCREIF) is the American association of institutional real estate professionals who share a common interest in their industry. This includes investment managers, plan sponsors, academicians, consultants, appraisers, CPA's and other service providers who have a significant involvement in institutional real estate investments. They come together to address vital industry issues and to promote research. NCREIF acts as a non-partisan collector, processor, validator and disseminator of real estate performance information, including several quarterly indices. https://www.ncreif.org.
---
[1] The number is deemed to be representative of the global non-listed real estate fund manager universe despite some variation in the number of respondents to the survey from one year to another.
[2] Source: ANREV/INREV/NCREIF 2024 Capital Raising Survey.
[3] Dry powder helps to assess the state of the industry in terms of the total undrawn contractually committed from investors capital, which is available and ready for deployment but is not yet invested.