PGIM Real Estate completed nearly $30 billion in transactions worldwide in 2020. The volume represents a total of 911 transactions and includes $10.2 billion in real estate equity investments and dispositions on behalf of third-party investors, in addition to $19.5 billion in real estate financing. PGIM is the $1.4 trillion global investment management business of Prudential Financial, Inc. (NYSE: PRU).
“While COVID-19 brought on challenges in 2020 that we couldn’t have anticipated or specifically planned for, PGIM Real Estate has been preparing for a market downturn for the past several years,” said Eric Adler, president and CEO of PGIM Real Estate. “We entered the pandemic from a position of exceptional strength and resiliency, with rigorous investment and operational risk infrastructure in place globally and considerable liquidity across our debt and equity businesses.”
The total transaction volume includes approximately $25.3 billion through 835 transactions in the Americas, composed of $6.9 billion in equity and $18.4 billion in debt; $3.3 billion through 53 European transactions, composed of $2.4 billion in equity and $898 million in debt; and $1.0 billion through 23 transactions across Asia Pacific, composed of $869 million in equity and $169 million in debt.
Adler added, “Our equity business had the liquidity needed to quickly capitalize on accelerated secular trends, such as surging e-commerce demand and a shift toward suburban housing in the U.S., on behalf of our investors this past year. Our debt business has provided our clients with capital protection and cashflow resilience and has benefited from an opportunity to gain market share—particularly for our agency lending platform—as banks face further regulatory constraints.”
PGIM Real Estate Equity Transaction Highlights
- Americas: In the U.S., PGIM Real Estate acquired a 30-property industrial portfolio totaling 5.4 million square feet on behalf of its U.S. core real estate strategy, in partnership with Perlmutter Investment Company’s IAC Properties. The portfolio is valued at approximately $700 million.
- Europe: PGIM Real Estate made its first acquisition in the UK on behalf of the investors in its European core strategy, capitalizing on compelling investment opportunities in the market’s private rental and build-to-rent sectors. The residential property, known as “Centre Square”, consists of 123 multifamily rental units, situated on a central site in High Wycombe, Buckinghamshire.
- Asia Pacific: On behalf of its Asia core strategy, PGIM Real Estate acquired a six-building multifamily portfolio located across Tokyo and Yokohama, Japan, valued at approximately US$120 million. The portfolio consists of newly completed mid-market residential buildings, with a total of 353 residential units, and will benefit from population growth and the migration of young working adults to the major cities.
PGIM Real Estate Debt Transaction Highlights
- Agency: PGIM Real Estate’s agency lending platform in the U.S. recorded a record $9.6 billion in multifamily production volume in 2020 across 468 loans for both conventional and affordable properties, earning a top 5 ranking from Fannie Mae while strengthening its relationships with Freddie Mac and FHA. Key highlights include a $73 million construction takeout for a mixed-use property in Reston, VA, as well as a $220 million financing for two uncrossed pool transactions, including 25 properties in Bronx, NY, representing Fannie Mae’s first green loan involving solar panels.
- Core: Driven primarily by industrial and multifamily transactions, PGIM Real Estate recorded over $7.0 billion in core financing globally across 143 loans, including 6.0 billion in the U.S., highlighted by a $356 million acquisition financing for a diversified 10-property industrial portfolio. Additionally, PGIM Real Estate executed $580 million in senior housing financing in 2020, including a $222 million credit facility for 10 senior housing properties located across Washington, California, and Nevada.
- Core Plus: The firm recorded $536 million in core-plus financing across seven transactions.
- Agricultural: The firm recorded more than $1.5 billion in production across agriculture, timberland, and agribusiness groups.
PGIM Real Estate has as much as $20 billion available for real estate financing in 2021.