The Ares Real Estate Group offers comprehensive real estate investments across the risk-return spectrum, spanning operations in private and public markets, executing debt and equity strategies with a primary focus on major property types. Led by Co-Heads, John Bartling and Lee Neibart, the Real Estate Group’s executive team averages more than 30 years of relevant real estate investment experience. The Ares Real Estate Group is comprised of four platforms: U.S. Equity, European Equity, India Equity and Global Debt. We leverage the following core capabilities across our platform:
- Experienced Leadership—Stable and deep team that has been market cycle-tested and is established in local markets across the world
- Global Market Perspective—Integrating a global market view with local market knowledge and fundamental asset analysis
- Multi-Channel Sourcing—Deep connectivity into local property networks, providing off-market deal flow
- Proprietary Research—Corporate and industry research to identify and capitalize on market trends
We manage approximately $8 billion of committed capital as of September 30, 2013 with approximately 140 total employees with a global footprint across 15 cities across the U.S., Europe and India. (1) We believe the Real Estate Group’s multi-asset class expertise, global scale and deep property knowledge differentiate it from other investors in the real estate market.
Real Estate Equity
Within the Real Estate Equity segment, we invest in a variety of real estate properties across a broad range of markets and investment cycles. The team manages approximately $5.5 billion of committed capital across over 185 properties in the U.S., Europe and India. Since 1993, we have overseen the investment of multiple equity real estate funds and joint ventures, through which we have invested approximately $13 billion in more than 570 transactions with an aggregate value in excess of $67 billion. Our investment offerings have expanded from initial global opportunistic funds to include a broad range of regionally focused investment vehicles throughout U.S., Europe, and India.
Our Real Estate Equity team is an experienced global real estate investor with the ability to select attractive properties across a variety of markets, geographies and investment cycles. The team’s investment approach focuses on fundamental real estate analysis, but considers factors such as the macroeconomic environment, the direction of the business cycle and local real estate market conditions. Our investment objective is to create a balanced portfolio of assets, across multiple asset classes and geographies. We focus on situations where we believe we hold a competitive advantage, which may be due to our demonstrated ability to complete complex transactions, our expertise in creating solutions to financial or tax issues or our ability to add value through intensive asset management and repositioning.
We believe that a highly attractive real estate investment environment is available to investors with real estate expertise, local market knowledge and the ability to execute sophisticated investment strategies. We believe our track record of equity investing and extensive network of relationships give us the qualifications and competitive advantages necessary to successfully invest and manage our investments. In addition, Ares’ multiple asset class strategy provides our team with insights into industry trends, access to proprietary deal flow and a competitive edge in assessing relative value.
Real Estate Debt
Our Real Estate Debt segment focuses on originating, investing in and managing middle-market commercial real estate loans and other commercial real estate investments. Through our national direct origination platform, we provide flexible financing solutions for owner-operators and financial sponsors of commercial real estate properties. As of September 30, 2013, the Ares Real Estate Debt team managed approximately $2.5 billion in committed capital across more than 115 properties. In addition, we have a 1,000 + loan servicing portfolio associated with our governmentally sponsored multifamily origination and servicing platform. (2)
In addition to managing private funds, we make investments through a specialty finance company, Ares Commercial Real Estate Corporation (“ACRE”), a publicly traded real estate investment trust (REIT) listed on the New York Stock Exchange under the ticker symbol “ACRE”. As of September 30, 2013, ACRE had an investment portfolio of over $760 million in commitments.
Visit Ares Commercial Real Estate Corporation ("ACRE") website
Our Real Estate Group’s Debt team focuses on directly originating loans using its extensive national relationships with various owner-operators, sponsors and intermediaries of real estate properties. We seek to provide flexible financing across a potential borrower’s capital structure. While we focus on self-originated transactions, we will also selectively pursue secondary market acquisitions and club/syndicated transactions. We target the middle-market segment of commercial real estate, which is generally defined as assets with values ranging from $15-100 million.
The following highlights our lending strategy:
- Pursue strong risk-adjusted returns by investing in what we believe to be the most attractive position in a given capital structure
- Drive internal deal flow primarily through direct origination
- Emphasize flexible transactions where our competitive advantages are strongest
- Actively manage portfolio through rated special servicer
- Lead transactions and remain an active investor
- Leverage the power of the Ares platform
We believe our principal orientation, flexibility and non-bureaucratic approach differentiate us from other debt capital providers in the commercial real estate middle market. In addition to offering senior and subordinated debt products, we actively provide “stretch senior” facilities and transitional senior loans in order to customize financing solutions for the specific transaction needs of our clients.
On August 30, 2013, ACRE closed its acquisition of EF&A Funding, L.L.C., d/b/a Alliant Capital LLC, for approximately $61 million through a combination of $53.4 million in cash and the issuance of 588,235 shares of ACRE stock. Upon closing of this transaction, Alliant Capital became a portfolio company wholly owned, by a taxable REIT subsidiary of ACRE and has been renamed ACRE Capital LLC. ACRE Capital LLC is a financial services company focused on originating and servicing multi-family loans for various Government and Government-Sponsored Entities (“GSEs”), primarily through the Fannie Mae Delegated Underwriting and Servicing (DUS®) program. With approximately 90 employees located across 15 offices throughout the U.S., ACRE Capital LLC has developed a significant origination, asset management and servicing platform.(3) As of March 31, 2013, ACRE Capital, LLC had a servicing portfolio of approximately $3.9 billion in multi-family loans.
Ares Management Closes Acquisition of AREA Property Partners
On July 1, 2013, Ares Management LLC announced that it has completed its acquisition of AREA Property Partners, L.P., a top-tier real estate management firm investing across North America, Europe, and India.
|Primary Roles: ||Private equity investor/direct lender|
|Offices: ||Atlanta, Chicago, Dallas, Los Angeles, New York, San Francisco and Washington, D.C.|
|Primary Areas of Focus: ||Multi-family, industrial, hospitality, office, residential and retail|
|Types of Investments ||First lien loans, A-notes, subordinated debt, B-notes, mezzanine debt, preferred equity(4), common equity(4), senior loans, stretch senior loans, transitional senior loans, subordinated debt, and other commercial real estate investments.|
(1) As of September 30, 2013. Committed Capital Under Management is unaudited, reflects rounding, and includes unfunded commitments as well as all amounts available under debt facilities.
(2) On August 30, 2013, Ares Commercial Real Estate Corporation (“ACRE”) acquired Alliant Capital, LLC. Upon closing of the transaction, Alliant Capital LLC became a portfolio company wholly owned by a taxable REIT subsidiary of ACRE and has been renamed ACRE Capital LLC.
(3) ACRE Capital LLC employees support the Ares Real Estate Group but are not employees of Ares Management LLC.
(4) None of our fund strategies involve the active trading of securities instruments; however, securities instruments may be acquired/disposed in accordance with the general strategy of the fund.