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Kayne Anderson Closes On $1.8B Alt Real Estate Fund

Alternative sector specialist Kayne Anderson Real Estate has closed its fifth opportunistic equity fund, Kayne Anderson Real Estate Partners V, at a cap of $1.8B.


The fund is targeting senior housing, medical office and student housing assets, and according to KA Real Estate it already has a robust pipeline of investment opportunities in the works. 

"Much as we had a first-mover advantage in student housing 10 years ago, we see the same opportunity in seniors housing and medical office today," KA Real Estate Managing Partner and CEO Al Rabil said in a statement.

Alternative investments, especially in the senior housing and healthcare-related space, are gaining luster because of the aging baby boomer population, the Wall Street Journal reports.

More immediately, alternative assets are believed to be more resistant to the boom-and-bust cycle of standard assets because demand for these assets is more constant. That is an important consideration now that the commercial property up-cycle has been running for nearly a decade, and seems a little long in the tooth.

The fund is KA Real Estate's largest and has attracted capital from a wide range of investors, including pensions, foundations, endowments, corporations, high net worth individuals and family offices. So far, KAREP V has deployed more than 20% of its capital.

KA Real Estate, which is the real estate private equity arm of Kayne Anderson Capital Advisors, has a current portfolio of more than 12M SF of medical office space, about 10,500 senior housing units and 4,500 student housing beds. Besides its acquisitions, it has also been an active asset seller as of late.