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Brookfield And Starwood Raise A Combined $16B Of New Equity As Opportunity Funds Go Big

Brookfield Property Partners and Starwood Capital are the latest opportunity fund managers to raise huge war chests for new investments.

HFF CEO Mark Gibson Brookfield Property Group chairman Ric Clark
HFF CEO Mark Gibson interviewing Brookfield Property Group Chairman Ric Clark at a Georgetown University event.

In March, Brookfield held a closing for its Brookfield Strategic Real Estate Partners III fund and has raised $9B for the fund, according to a filing with the Securities and Exchange Commission. That means the fund is already close to surpassing its predecessor, and will be one of the largest ever real estate funds when it reaches or surpasses its target of $10B later this year.

According to marketing materials for the fund, it is targeting returns of 16% to 20%. Around half of the equity will be spent in the U.S. with the rest in Europe, Asia and South America.

Starwood has held a final close raising $7.6B for Starwood Global Opportunity Fund XI, according to Private Equity Real Estate magazine. That is its largest ever fund, well ahead of its initial $6B target.

Starwood has already spent more than $1B of the equity, including committing equity to its $1.3B acquisition of Milestone Apartments REIT in April last year; a $250M investment to buy a 30% stake in hotel operator Yotel; and the £135M purchase of seven U.K. Hilton hotels.