New York investment firm Neuberger Berman is locked and loaded with its next real estate private equity secondary fund.
George Walker’s firm raised more than $1 billion for NB Real Estate Secondary Opportunities Fund II LP, Bloomberg reported. The fundraising exceeded the company’s target for the fund by 30 percent and surpassed the predecessor fund by 48 percent; the previous fund had $712 million in total investor commitments.
The latest fund is set to target interests in mature real estate funds, including from limited partners searching for liquidity. The fund is expected to be focused on the middle market and be geared towards the United States and Europe, with slight exposure to Asia.
“Our strategy is really about finding opportunities to invest in high-quality assets with a relatively short duration, as opposed to assets that might need a turnaround plan,” Neuberger Berman real estate secondaries business head Scott Koenig said in a recent interview.
The secondaries market revolves around the buying and selling of stakes from private capital funds and early exiting investors. Transaction volume in the space is surging as initial public offerings and M&A activity struggle.
In 2023, secondaries funds closed $9.8 billion in transactions, according to Bisnow. Major institutional players such as Blackstone, Goldman Sachs and Ares each raised over $2 billion that year.
Founded in 1939, Neuberger Berman has $508 billion in assets under management, according to the company’s website, a majority of which are in public markets. The assets include $8 billion in private real assets, including private real estate through Almanac Realty Investors, real estate secondaries and real estate primaries/co-investments, as well as infrastructure.
The company recently agreed to lease 52,000 square feet on North Wacker Drive in Chicago’s West Loop neighborhood, reducing its footprint in the city by 14,000 square feet. The firm employs 760 investment professionals across the world.