Hines Closes Latest Fund at $750M

Alfonso Munk, CIO, Americas, Hines. Image courtesy of Hines

Hines has launched a new open-ended, commingled fund, Hines U.S. Property Partners, which includes in its $750 million of equity commitments a $100 million investment from the company.

With more than $1.2 billion in immediate investment capacity, HUSPP will target next-generation assets in top-performing submarkets in major U.S. markets. The fund expects to invest in the residential, industrial, office and mixed-use sectors, along with such niche sectors as life sciences and self-storage, with the goal of building a diversified portfolio with a balance of yield and growth.

HUSPP investors so far include institutional investors such as public pension plans, insurance companies, non-profit organizations and family offices. As an open-ended, perpetual fund, HUSPP will be expected to raise capital continually; over time it should become a multi-billion-dollar institutional fund targeting core plus returns in the U.S. market.

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According to Hines’ Global CIO David Steinbach, as real estate continues to evolve into a service, investors are finding increased value to work directly with large scale operators that bring innovation, flexibility and simplicity for the tenants.

HUSPP will seek to deliver future-proofed, sustainable assets that align with the Hines’ corporate ESG initiative that focuses on addressing the climate emergency and reducing the carbon footprint of the built environment. The fund’s strategy will include undertaking select development to create next-generation assets catering to future tenant demand.

“As we emerge from the pandemic, the real estate industry is at a critical inflection point and successful managers will need to examine their portfolios in an increasingly dynamic environment,” Alfonso Munk, Hines’ CIO of Americas, said in a prepared statement.

Kirkland & Ellis LLP was Hines’ legal advisor in connection with the fund.

Diversification

Hines has been advancing on multiple fronts over the past couple years. In January of last year, barely before the pandemic hit, the company hit the first close, at $700 million, of its $1.4 billion Hines European Value Fund 2.

Last November, Hines’ Pan-European Core Fund acquired a three-building logistics park near London’s Heathrow Airport for about $106 million.

And in June, in partnership with Cresset Real Estate Partners, Hines broke ground on Whiteland 65 Logistics Center, a 1.1-million-square-foot project in metro Indianapolis.