PGIM Real Estate completed nearly US$30 billion in transactions worldwide in 2020. The volume represents a total of 911 transactions and includes $10.2 billion in real estate equity investments and dispositions on behalf of third-party investors, in addition to $19.5 billion in real estate financing. PGIM Real Estate is the real estate investment and financing business of PGIM, the $1.4 trillion global investment management business of Prudential Financial, Inc. ( NYSE: PRU).
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President and CEO, PGIM Real Estate (Photo: Business Wire)
"While COVID-19 brought on challenges in 2020 that we couldn't have anticipated or specifically planned for, PGIM Real Estate has been preparing for a market downturn for the past several years," said Eric Adler, president and CEO of PGIM Real Estate. "We entered the pandemic from a position of exceptional strength and resiliency, with rigorous investment and operational risk infrastructure in place globally and considerable liquidity across our debt and equity businesses."
The total transaction volume includes approximately $25.3 billion through 835 transactions in the Americas, composed of $6.9 billion in equity and $18.4 billion in debt; $3.3 billion through 53 European transactions, composed of $2.4 billion in equity and $898 million in debt; and $1.0 billion through 23 transactions across Asia Pacific, composed of $869 million in equity and $169 million in debt.
Adler added, "Our equity business had the liquidity needed to quickly capitalize on accelerated secular trends, such as surging e-commerce demand and a shift toward suburban housing in the U.S., on behalf of our investors this past year. Our debt business has provided our clients with capital protection and cashflow resilience and has benefited from an opportunity to gain market share—particularly for our agency lending platform—as banks face further regulatory constraints."
PGIM Real Estate Equity Transaction Highlights
- Americas: In the U.S., PGIM Real Estate acquired a 30-property industrial portfolio totaling 5.4 million square feet on behalf of its U.S. core real estate strategy, in partnership with Perlmutter Investment Company's IAC Properties. The portfolio is valued at approximately $700 million.
- Europe: PGIM Real Estate made its first acquisition in the UK on behalf of the investors in its European core strategy, capitalizing on compelling investment opportunities in the market's private rental and build-to-rent sectors. The residential property, known as "Centre Square", consists of 123 multifamily rental units, situated on a central site in High Wycombe, Buckinghamshire.
- Asia Pacific: On behalf of its Asia core strategy, PGIM Real Estate acquired a six-building multifamily portfolio located across Tokyo and Yokohama, Japan, valued at approximately US$120 million. The portfolio consists of newly completed mid-market residential buildings, with a total of 353 residential units, and will benefit from population growth and the migration of young working adults to the major cities.
PGIM Real Estate Debt Transaction Highlights
Agency: PGIM Real Estate's agency lending platform in the U.S. recorded a record $9.6 billion in multifamily production volume in 2020 across 468 loans for both conventional and affordable properties, earning a top 5 ranking from Fannie Mae while strengthening its relationships with Freddie Mac and FHA. Key highlights include a $73 million construction takeout for a mixed-use property in Reston, VA, as well as a $220 million financing for two uncrossed pool transactions, including 25 properties in Bronx, NY, representing Fannie Mae's first green loan involving solar panels.
Core: Driven primarily by industrial and multifamily transactions, PGIM Real Estate recorded over $7.0 billion in core financing globally across 143 loans, including 6.0 billion in the U.S., highlighted by a $356 million acquisition financing for a diversified 10-property industrial portfolio. Additionally, PGIM Real Estate executed $580 million in senior housing financing in 2020, including a $222 million credit facility for 10 senior housing properties located across Washington, California, and Nevada.
Core Plus: The firm recorded $536 million in core-plus financing across seven transactions.
Agricultural: The firm recorded more than $1.5 billion in production across agriculture, timberland, and agribusiness groups.
PGIM Real Estate has as much as $20 billion available for real estate financing in 2021.
About PGIM Real Estate
As one of the largest real estate managers in the world with US$182.5 billion in gross assets under management and administration 1, PGIM Real Estate strives to deliver exceptional outcomes for investors and borrowers through a range of real estate equity and debt solutions across the risk-return spectrum. PGIM Real Estate is a business of PGIM, the US$1.4 trillion global asset management business of Prudential Financial, Inc. (PFI) ( NYSE: PRU).
PGIM Real Estate's rigorous risk management, seamless execution, and extensive industry insights are backed by a 50-year legacy of investing in commercial real estate, a 140-year history of real estate financing 2, and the deep local expertise of professionals in 32 cities globally. Through its investment, financing, asset management, and talent management approach, PGIM Real Estate engages in practices that ignite positive environmental and social impact, while pursuing activities that strengthen communities around the world. For more information visit pgimrealestate.com.
PGIM is the global asset management business of Prudential Financial, Inc. ( NYSE: PRU). PFI ranks among the top 10 largest asset managers in the world 3 with more than US$1.4 trillion in assets under management as of 31 Dec. 2020. With offices in 16 countries, PGIM's businesses offer a range of investment solutions for retail and institutional investors around the world across a broad range of asset classes, including public fixed income, private fixed income, fundamental equity, quantitative equity, real estate and alternatives. For more information about PGIM, visit pgim.com.
Prudential Financial, Inc. (PFI) of the United States is not affiliated in any manner with Prudential plc, incorporated in the United Kingdom or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom. For more information please visit news.prudential.com.
1 As of 30 Sept. 2020. Net AUM is $121.3 billion and AUA is $40.4 billion. 2 Includes legacy lending through PGIM's parent company, PFI. 3 Prudential Financial, Inc. (PFI) is the 10th largest investment manager (out of 527 firms surveyed) in terms of global assets under management based on Pensions & Investments' Top Money Managers list published on 1 June 2020. This ranking represents global assets under management by PFI as of 31 March 2020.
For Professional Investors only. All investments involve risk, including the possible loss of capital.
PGIM is the primary asset management business of Prudential Financial, Inc (PFI). PGIM Real Estate is PGIM's real estate investment advisory business and operates through PGIM, Inc., a registered investment advisor. Registration as a registered investment adviser does not imply a certain level or skill or training. PGIM, their respective logos as well as the Rock symbol are service marks of PFI and its related entities, registered in many jurisdictions worldwide. PFI of the United States is not affiliated in any manner with Prudential plc, incorporated in the United Kingdom or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom. In the United Kingdom, information is issued by PGIM Limited with registered office: Grand Buildings, 1-3 Strand, Trafalgar Square, London, WC2N 5HR. PGIM Limited is authorised and regulated by the Financial Conduct Authority ("FCA") of the United Kingdom (Firm Reference Number 193418). In the European Economic Area ("EEA"), information is issued by PGIM Real Estate Luxembourg S.A. with registered office: 2, boulevard de la Foire, L-1528 Luxembourg. PGIM Real Estate Luxembourg S.A. is authorised and regulated by the Commission de Surveillance du Secteur Financier (the "CSSF") in Luxembourg (registration number A00001218) and operating on the basis of a European passport. In certain EEA countries, information is, where permitted, presented by PGIM Limited in reliance of provisions, exemptions or licenses available to PGIM Limited under temporary permission arrangements following the exit of the United Kingdom from the European Union. These materials are issued by PGIM Limited and/or PGIM Real Estate Luxembourg S.A. to persons who are professional clients as defined under the rules of the FCA and/or to persons who are professional clients as defined in the relevant local implementation of Directive 2014/65/EU (MiFID II). In Germany, this material is distributed by PGIM Real Estate Germany AG, a regulated entity by the Bundesanstalt für Finanzdienstleistungen (BaFin).The information provided in the document is presented by PGIM (Singapore) Pte. Ltd.), a Singapore investment manager that is registered with, and licensed by the Monetary Authority of Singapore. In Hong Kong, information is provided by PGIM (Hong Kong) Limited, a regulated entity with the Securities & Futures Commission in Hong Kong to professional investors as defined in Section 1 of Part 1 of Schedule 1 (paragraph (a) to (i) of the Securities and Futures Ordinance (Cap.571). In Australia, information is issued by PGIM (Australia) Pty Ltd ("PGIM Australia") for the general information of its "wholesale" customers (as defined in the Corporations Act 2001). PGIM Australia is a representative of PGIM Limited, which is exempt from the requirement to hold an Australian Financial Services License under the Australian Corporations Act 2001 in respect of financial services. PGIM Limited is exempt by virtue of its regulation by the Financial Conduct Authority under the laws of the United Kingdom and the application of ASIC Class Order 03/1099. The laws of the United Kingdom differ from Australian laws.
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