Business Management Executive Q&A
Sept 10, 2007
By: Barbra Murray, Contributing Editor
BPG Properties Ltd. has just closed BPG Investment Partnership VIII L.P., an $850 million real estate investment vehicle that constitutes the Philadelphia-based real estate fund manager's largest private equity fund to date. Daniel DiLella (pictured), president & CEO of BPG Properties, spoke to CPN today about Fund VIII, which has an investment period of three years and nearly $3 billion in buying power.
CPN: Who are the investors in Fund VIII?
DiLella: This particular fund has just one foreign investor. The remaining are pension funds, endowments and foundations, and a handful of large family trusts.
CPN: Fund VIII will pursue investments in value-add office, multi-family, industrial and retail properties across the country, but are there specific regions that are of particular interest?
DiLella: We go where we think there is a disconnect between perceived values and what's available in the market. Recently, we've had a lot of success in the Midwest in markets like Chicago and Indianapolis. And we've had a lot of success with corporate real estate.
CPN: Will the fund focus on acquisitions only?
DiLella: We'll mostly make acquisitions, but if we see a good development opportunity in our investment field, we'll do it. The product that we buy normally needs some type of redevelopment, but very little new development. But you never know; we've done build-to-suits in the past.
CPN: There appears to be no shortage of hefty private equity real estate funds, some over the billion-dollar mark, closing lately; do you think there's an end in sight for this private equity buying binge?
DiLella: Real estate has become a mainstream investment vehicle that people want in their portfolio. In my opinion, overall, real estate as an investment vehicle is here to stay, and it's here to stay on a global basis. But real estate is still a local market; you still have to buy locally. We have investors in the fund from all over the country, but we still have to understand the local market. Real estate is more of a hands-on industry.
By: Barbra Murray, Contributing Editor
BPG Properties Ltd. has just closed BPG Investment Partnership VIII L.P., an $850 million real estate investment vehicle that constitutes the Philadelphia-based real estate fund manager's largest private equity fund to date. Daniel DiLella (pictured), president & CEO of BPG Properties, spoke to CPN today about Fund VIII, which has an investment period of three years and nearly $3 billion in buying power.
CPN: Who are the investors in Fund VIII?
DiLella: This particular fund has just one foreign investor. The remaining are pension funds, endowments and foundations, and a handful of large family trusts.
CPN: Fund VIII will pursue investments in value-add office, multi-family, industrial and retail properties across the country, but are there specific regions that are of particular interest?
DiLella: We go where we think there is a disconnect between perceived values and what's available in the market. Recently, we've had a lot of success in the Midwest in markets like Chicago and Indianapolis. And we've had a lot of success with corporate real estate.
CPN: Will the fund focus on acquisitions only?
DiLella: We'll mostly make acquisitions, but if we see a good development opportunity in our investment field, we'll do it. The product that we buy normally needs some type of redevelopment, but very little new development. But you never know; we've done build-to-suits in the past.
CPN: There appears to be no shortage of hefty private equity real estate funds, some over the billion-dollar mark, closing lately; do you think there's an end in sight for this private equity buying binge?
DiLella: Real estate has become a mainstream investment vehicle that people want in their portfolio. In my opinion, overall, real estate as an investment vehicle is here to stay, and it's here to stay on a global basis. But real estate is still a local market; you still have to buy locally. We have investors in the fund from all over the country, but we still have to understand the local market. Real estate is more of a hands-on industry.
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