Griffin Capital Spins Off Griffin Institutional Access RE Fund

By Gail Kalinoski, Contributing Editor

Randy Anderson

Griffin Capital Corp. has launched Griffin Institutional Access Real Estate Fund, which is trading on NASDAQ as GIREX and includes several large private institutional real estate funds in its investment portfolio.

GIREX, which had an initial share price of $25 when it began trading June 30 on Nasdaq, was trading at $25.02 on Tuesday afternoon.

“We are pleased to bring Griffin Institutional Access Real Estate Fund to the market,” Randy Anderson, portfolio manager of the fund & Chief Investment Officer of GIREX and Griffin Capital Advisor, said in a news release.

“We believe that the combination of our public and private investments, selected with the assistance of our two industry-leading sub-advisors, is a recipe for success for many investors in today’s market,” added Anderson, who holds a doctorate in finance and is also Griffin Capital’s chief economist.

Kevin Shields, Griffin Capital’s chairman & CEO, said in the release the fund “is a great complement to our platform.”

As part of the initial investment allocation of its portfolio managers, the fund invested in several private investment funds including RREEF America II, BlackRock Granite, AEW Core Property Trust, Sentinel Real Estate Fund, Clarion Lion Properties Fund and MEPT Edgemoor.

The strategy will be to invest in a blend of private institutional real estate investments funds and a diversified set of public market real estate securities. Griffin Capital notes in the release that this “combination that has proven over long periods of time to provide both current income and capital appreciation, with moderate volatility and low correlation to the broader market.”

The fund will have two sub-advisors to monitor and help optimize the two investment focuses. Hewitt EnnisKrupp, an Aon company with $4.6 trillion under advisement, will serve as sub-advisor for the private funds allocation. CenterSquare Investment Management, a BNY Mellon company, will serve as sub-advisor for the public securities investments.

Anderson told Commercial Property Executive the reason Griffin started the fund now is that increasingly more individual investors are responsible for their own retirement plans. But most individuals don’t have access to the real estate funds within GIREX on their own, he added.

“Now they can get into those funds and their investment dollars will be sitting side by side with pension funds, high-net-worth individuals and sovereign funds,” Anderson told CPE.

He said GIREX is a “nice broadly diversified portfolio that is professionally managed all the way down through the asset.”

The funds within the portfolio focus invest in multi-family, office, industrial and retail, according to Anderson.

“The other thing that is really important about our fund is that we are going to have an actively managed public market component,” he said. “We think that not only do we give individuals access to these private funds but the combination should give strong risk adjusted returns.”

Griffin Capital is a privately-owned real estate company based in Los Angeles. The firm and its affiliates have acquired or constructed ,ore than 30 million square feet of space since 1995, and own, manage, sponsor or co-sponsor a portfolio of about 27 million square feet in 32 states and 1 million square feet in the United Kingdom, representing approximately $5.2 billion in assets as of June 30.

Griffin Capital, along with American Healthcare Investors, is a co-sponsor of Griffin-American Healthcare REIT I and II, which have jointly acquired more than $2.8 billion in healthcare-related properties since 2009. The company also sponsors Griffin Capital Essential Asset REIT, Inc. a non-traded REIT with a portfolio of 46 office and industrial distribution properties totaling approximately 11 million square feet worth about $2 billion.