Fig. 1: Top Five Largest Real Estate Funds to Close in Q3 2010

Fig. 5: Average Time Taken for PERE Funds to Achieve a Final Close by Year Fund Closed

Fig. 3:Private Equity Real Estate Fundraising by Primary Geographic Focus, Q3 2010

13

1

56.0

0.81.9

02468

101214

North America Europe Asia and Rest of World

No. of Funds Aggregate Capital Raised ($bn)

© 2010 Preqin Ltd. / www.preqin.com

Preqin Research Report Q3 2010 Private Equity Real Estate Fundraising Update

Preqin provides information, products and services to real estate fi rms, fund of funds, investors, placement agents, law fi rms, advisors and other professionals across six main areas:

> Fund Performance> Fundraising> Fund Manager Profi les> Investor Profi les> Fund Terms> Compensation and Employment

Available as:> Hard Copy Publications> Online Database Services> Consultancy and Research Support> Tailored Data Downloads

For more information and to register for a demo, please visit:

www.preqin.com/realestate

9.8 1012.6

18.2 18.9

0

5

10

15

20

2006 2007 2008 2009 2010 YTD

Fund Firm Strategy Size (mn) Manager Country

Fund Focus

Fortress Credit Opportunities Fund II

Fortress Investment Group

Debt and Distressed 2,600 USD US Global

TA Realty Associates IX

TA Associates Realty

Core-Plus, Debt, Distressed and Value Added

1,700 USD US US

Brockton Capital II Brockton Capital Debt, Distressed and Opportunistic 496 GBP UK UK

AG Asia Realty Fund II

Angelo, Gordon & Co

Distressed and Opportunistic 625 USD US Asia

AG Net Lease Realty Fund II

Angelo, Gordon & Co Value Added 550 USD US US

2 3 3 51010

611

1612

18

2723

2723

2724

3631

3534

4342

21

1514

9 1015

8 9

05

1015202530354045

Q1

2003

Q2

2003

Q3

2003

Q4

2004

Q1

2004

Q2

2004

Q3

2004

Q4

2004

Q1

2005

Q2

2005

Q3

2005

Q4

2005

Q1

2006

Q2

2006

Q3

2006

Q4

2006

Q1

2007

Q2

2007

Q3

2007

Q4

2007

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

Q2

2010

Q3

2010

Fig. 2: Global Private Equity Real Estate Fundraising, Q1 2003 - Q3 2010

There was an increase in aggregate capital raised in Q3 2010 from the previous quarter of 14%, with 19 funds closing with aggregate commitments of $8.7 billion, up from the $7.6 billion raised in Q2 2010. However, since 2005 there have only been two quarters in which less capital was raised, demonstrating that fundraising remains extremely challenging in the current environment. 13 primarily North America-focused funds raised a total of $6.0 billion, one primarily Europe-focused fund closed on $0.8 billion, and fi ve primarily Asia and Rest of World-focused funds raised $1.9 billion.

The aggregate target of funds currently on the road seeking capital continued to decline over Q3 2010, as Fig. 4 shows. However, the number of funds in market increased to 403 over the period, perhaps suggesting a slight increase in fund

manager confi dence in the prospects for fundraising in the coming months.

The average time taken for private equity real estate funds to reach a fi nal close has continued to increase over 2010, as Fig. 5 shows. Funds closed in 2010 to date have taken an average of 18.9 months to reach a fi nal close, up from 18.2 months in 2009 and nearly double the average time taken for funds closing in 2006.

The largest fund to close in Q3 2010 was Fortress Credit Opportunities Fund II. The vehicle aims to make investments in a range of distressed and undervalued credit investments including, but not limited to, opportunistic corporate loans and securities, residential loans and securities, commercial mortgage loans and securities and other consumer or commercial assets and asset-backed securities.

Full results and report on Q3 2010 PERE fundraising will be available in Preqin’s monthly newsletter, Real Estate Spotlight.

To register to receive Spotlight please visit: www.preqin.com/spotlight

Fig. 4:Private Equity Real Estate Funds on the Road over Time, Q1 2007 - Q4 2010

76

273

381 390 378 363 376 383 378 403

33

127

228 227 199 178 173 147 134 132

050

100150200250300350400450

Q1 2007

Q1 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

Q3 2010

Q4 2010

No. of Funds in Market Aggregate Target ($bn)

Agg

rega

te C

apita

l Rai

sed

($bn

)

Aver

age

Tim

e S

pent

in M

arke

t (M

onth

s)

Source: Preqin

Source: Preqin

Source: Preqin

Source: Preqin

Source: Preqin