Blackstone is close to raising $10B for its latest opportunity fund, which will be one of the largest real estate funds ever raised even though it is a regional rather than global fund.

According to PERE, Blackstone will announce an equity raising in the coming weeks that will capture nearly all of the $10B target for Blackstone Real Estate Partners Europe VI.

Only the global funds raised by Blackstone and Brookfield’s third global opportunity fund, which raised $15B in January, have ever raised more capital.

The fundraising is a sign Blackstone still thinks it can make high returns investing in Europe in spite of worries that real estate is reaching the end of a cycle with prices in many markets near record highs.

Blackstone tends to invest in a small number of sectors about which it has high conviction. The two main sectors it has gone big on in Europe recently are rental housing, where it has bought large portfolios in Spain and Scandinavia in particular, and urban industrial assets, where it has built up a portfolio of around €6B in Europe, of which more than a third is in the UK.

There was still €3.1B of the €7.9B Blackstone raised for its fifth European fund uninvested as of the end of March, its first quarter results show. When debt is included that fund has spent €6.2B.

It has started selling assets and returning capital from its fourth European fund, which finished investing in 2016 and has spent a total of €11.7B. The returns show why investors are willing to invest with Blackstone again. The net internal rate of return is 24% on the €7.4B of assets it has sold from this fund — a two-times multiple on invested capital.

Blackstone's European real estate business is led by James Seppala. Head of European acquisitions Samir Amichi will be appearing at Bisnow's London Capital Markets event on 21 May.