2012 AWARDS & ANNUAL REVIEW | perenews.com

FOR THE WORLD’S PRIVATE REAL ESTATE MARKETS

AWARDS & 2012 ANNUAL REVIEW Last year turned out to be a year of cautious optimism for the real estate industry, as both GPs and LPs were a bit more active in the global property markets in 2012 following a year of uncertainty. Although invest- ment and fundraising activity improved somewhat from 2011, caution remained as America tried to put its near default behind it and tried to move past its various sovereign debt crises.

Once again, there was a bit of a have versus have-not undercurrent to the market as those firms and investors with a lot of capital at their disposal and/or a long, suc- cessful track record in the industry did better than others. The only difference in 2012 was there were a few more ‘have’ players to drive activity.

So, which firms, individuals and deals stood out from the crowd in 2012?

In an attempt to answer that question, we scoured our website and other real estate news sources to come up with a slate of finalists, which were vetted and then put to a vote by the readers of PERE and perenews.com. And vote they did, in the thousands.

If last year’s awards demonstrated a return to marquee names, this year’s voting confirmed the shift to larger, better-known players. For example, won four awards for 2012 – down from the firm’s impressive haul of eight for 2011, but still the most by any firm – and the Canada Pension Plan Investment Board racked up three wins, as did Patron Capital. Other industry stalwarts like Brookfield Asset Management, Global Logistic Properties, Partners Group and Lone Star Funds also won awards. Newer players, however, weren’t completely shut out, managing to snag an award here and there.

So, without further ado, PERE presents the results of the 2012 Global PERE Awards, along with brief profiles on the winning firms and individuals. GLOBAL pg. 8

INDUSTRY FIGURE OF THE YEAR DEAL OF THE YEAR Graeme Eadie, Canada Pension Plan Investment Global Logistic Properties’ R$2.9 billion acquisition Board of two industrial portfolios in Brazil

FIRM OF THE YEAR MULTI-MANAGER OF THE YEAR The Blackstone Group Partners Group

INSTITUTIONAL INVESTOR OF THE YEAR LATIN AMERICA FIRM OF THE YEAR Canada Pension Plan Investment Board GTIS Partners

CAPITAL RAISE OF THE YEAR MIDDLE EAST, AFRICA FIRM OF THE YEAR The Blackstone Group, Blackstone Real Investment of Dubai Estate Partners VII

NORTH AMERICA pg. 14

INDUSTRY FIGURE OF THE YEAR EXIT OF THE YEAR Barry Blattman, Brookfield Asset Management The estate of ’ sale of Archstone to AvalonBay and Equity Residential FIRM OF THE YEAR Brookfield Asset Management PLACEMENT AGENT OF THE YEAR Park Hill Group OF THE YEAR Teacher Retirement System of DEBT PROVIDER OF THE YEAR MetLife CAPITAL RAISE OF THE YEAR , Colony Distressed Fund II LAW FIRM OF THE YEAR (FUND FORMATION) Goodwin Procter DEAL OF THE YEAR The Blackstone Group’s of the CalWest LAW FIRM OF THE YEAR (TRANSACTIONS) portfolio from Walton Street Goodwin Procter

EUROPE pg. 20

INDUSTRY FIGURE OF THE YEAR EXIT OF THE YEAR Keith Breslauer, Patron Capital The Blackstone Group’s sale of student accommodation business Nido FIRM OF THE YEAR Lone Star Funds PLACEMENT AGENT OF THE YEAR INSTITUTIONAL INVESTOR OF THE YEAR Norwegian Government Global DEBT PROVIDER OF THE YEAR AXA Real Estate CAPITAL RAISE OF THE YEAR Patron Capital, Patron Capital IV LAW FIRM OF THE YEAR (FUND FORMATION) Clifford Chance DEAL OF THE YEAR Patron Capital and TPG Capital’s takeover LAW FIRM OF THE YEAR (TRANSACTIONS) of Uni-Invest and its office portfolio Clifford Chance

2012 AWARDS & ANNUAL REVIEW | PERE 3 GLOBAL FIRM OF THE YEAR 1 The Blackstone Group 2 Brookfield Asset Management 3 Lone Star Funds

One of The Blackstone Group’s biggest real estate feats of 2012 – indeed, its entire history – was completing a record $13.3 billion fundraising for its latest global opportunity fund, Blackstone Real Estate Partners (BREP) VII. However, the firm’s accomplishments in property last year went far beyond its epic equity haul. For starters, Blackstone invested or committed a record $9.4 billion in real estate in 2012, including $8.5 billion that was deployed and an additional $923 million that was ear- marked for investments. Among the deals executed on behalf of BREP VII were the acquisition of a A$1.8 billion (€1.39 billion; $1.85 billion) distressed loan portfolio in from Lloyd’s Banking Group for A$620 million, in partner- ship with Real Estate Investing; and the : one of Blackstone’s many purchases purchase of ’s US economy division, Motel 6, for $1.9 billion. Those transactions and others helped to reduce Blackstone had owned both senior and junior debt collateral- the amount of uninvested capital in the fund to $8.3 billion ized by the assets. by the end of the year. Still, it wasn’t all investments for Blackstone’s real estate Blackstone also continued to expand into new real estate business. The firm also made a number of notable exits, par- markets such as Turkey, where the firm agreed to buy three ticularly the $1.73 billion sale of its Sunwest assisted-living shopping centers for €200 million from Redevco, and Singa- portfolio in the US to healthcare REIT HCP, which yielded a pore, where it purchased a 400,000-square-foot office park 2.4x multiple after a two-year hold period. from SEB Asset Management for roughly $173 million. On the fundraising front, Blackstone wasn’t content to rest One major addition to Blackstone’s real estate portfolio on its BREP VII laurels. By the end of the year, the firm had was not an acquisition, but the takeover of the 95-property launched two new real estate funds: Blackstone Real Estate CalWest industrial portfolio from Walton Street Capital, after Debt Strategies II, a debt vehicle targeting $3 billion in com- the latter firm defaulted on the debt backing the properties. mitments, as well as its first -focused opportunity fund.

GLOBAL CAPITAL RAISE OF THE YEAR 1 The Blackstone Group, Blackstone Real Estate Partners VII 2 Brookfield Asset Management, Brookfield Strategic Real Estate Partners 3 Starwood Capital Group, Starwood Global Opportunity Fund IX

It’s hard to compete with the largest real estate fund ever raised. held a first close on $4 billion four months later, attracting capital Last year, The Blackstone Group amassed a record $13.3 billion from investors such as the New Jersey Division of Investment and for its latest global opportunity fund, Blackstone Real Estate the Pennsylvania Public School Employees’ Retirement System. Partners (BREP) VII. Although the firm collected nearly half of Other LPs, including the State of Wisconsin Investment Board, that amount in 2011, the remaining capital gathered in 2012 still subsequently came onboard, helping to boost the capital raise to exceeded the combined fundraises of its three closest competitors $6 billion by year’s end. in the market. The firm kept up the momentum in 2012, raising another $4 Indeed, the closest any firm had come to reaching such fund- billion and beating its raising heights was Blackstone itself, when the private equity gi- $10 billion target by February, when BREP VII’s second close ant completed fundraising for its previous global real estate fund, brought in investors such as the National Pension Service of Ko- BREP VI, which gathered a mere $10.9 billion in equity in 2008. rea. Additional LPs, such as the Florida State Board of Adminis- Blackstone officially launched BREP VII in April 2011 and tration, took the fundraise to its hard cap limit.

4 PERE | 2012 AWARDS & ANNUAL REVIEW NORTH AMERICA DEAL OF THE YEAR PLACEMENT AGENT OF THE YEAR 1 The Blackstone Group’s takeover of the CalWest portfolio from Walton Street 1 Park Hill Group 2 Greenhill & Co 2 Starwood Capital Group’s purchase of seven US shopping centers from The Westfield Group for $1 billion 3 Mercury Capital Advisors 3 The purchase of an R&D portfolio in for For the second year in a row, the Park Hill nearly $800 million by a venture between TPG Capital Group has won the award for placement agent and DivcoWest of the year, and with good reason. In 2012, Park When Walton Street Capital began to show sign of struggling to refinance Hill was instrumental in raising a considerable the debt on a massive portfolio of 95 US industrial assets last year, heavy- amount of capital, including on behalf of the weights The Blackstone Group and Morgan Stanley Real Estate began to vie largest real estate fund in the industry’s history. for control of the portfolio, which was worth about $2.1 billion. Ultimately, Of course, being an affiliate of The Blackstone it was Blackstone that won out. Group, perhaps it is not that surprising that the In 2007, Walton Street acquired the 23 million-square-foot portfolio, -based private equity and real estate known at the CalWest portfolio, from the California Public Employees’ giant asked Park Hill to help it raise $13.3 bil- Retirement System and RREEF for $2.75 billion – at the time, one of the lion for Blackstone Real Estate Partners VII. largest US industrial sales. The acquisition was financed with about $2.45 In addition to serving as placement agent for billion of debt, including a $1.1 billion senior loan and junior debt pieces Blackstone, Park Hill advised Atlanta-based with a total face value of about $1.4 billion. real estate firm Jamestown Properties on its With the loans against the industrial portfolio scheduled to mature on open-ended core-plus vehicle, Jamestown Pre- June – and Walton’s anticipated default – both Blackstone and Morgan mier Property Fund. The firm also was hired by Stanley began jockeying for control of the assets, the bulk of which are AREA Property Partners to help the New York- located in California, Washington and Oregon. Morgan Stanley, through based real estate investment manager raise its Prime Property Fund, acquired a $115 million junior debt piece, but capital for its current US value-added fund, Blackstone, which owned both senior and junior debt pieces, including AREA US Value Enhancement Fund VIII (as approximately $600 million of mezzanine debt that was acquired in April well as AREA European Real Estate Fund IV). 2011, ultimately wound up being in a stronger position.

EUROPE EXIT OF THE YEAR 1 The Blackstone Group’s sale of student accommodation business Nido 2 and Cerberus Capital Management’s sale of their remaining stake in GSW Immobilien 3 National Asset Management Agency of Ireland and ’s sale of Battersea Power Station

Exits in Europe gathered pace in 2012, with IPOs even on the agenda in the case of Goldman Sachs and Cerberus Capital Management, which fully exited their invest- ment in GSW Immobilien after having taken the German company public in 2011. However, it was a private sale of an operating company that scooped the prize for exit of the year. The Blackstone Group won the accolade for the sale of Nido Student Living, a student accommodation business, following a classic private equity build-and-sell play. The New York-based firm established Nido in 2006, when it developed a stu- dent block in the up-and-coming King’s Cross area of London. Following that, the company added London sites in Spitalfields and Notting Hill. The fully operational company was sold last year to Round Hill Capital, a real estate and energy investment management firm, in a deal valued at £415 million (€511.3 million; $676.2 million). PERE understands the exit by Blackstone reflected a profit of approximately £100 million for a number of the firm’s real estate opportu- nity funds. Despite the exit, one source familiar with the transaction and the firm said Black- stone still has an appetite for the student accommodation sector in Europe. That is A Nido building in London: passed the exam evidenced by its decision to hold onto development sites in London and Barcelona.

2012 AWARDS & ANNUAL REVIEW | PERE 5