Goldman Sachs Alternatives Raises More Than $3.4 Billion for Vintage Real Estate Partners III
NEW YORK — June 26, 2024 — Goldman Sachs Alternatives today announced the final close of its third dedicated real estate secondaries fund, Vintage Real Estate Partners III (“VREP III”), on $3.4 billion.
Vintage Strategies at Goldman Sachs Alternatives provide liquidity solutions to private market limited partner (“LP”) investors and general partner (“GP”) fund managers. Goldman Sachs is a longstanding leader in the secondaries space, with a history dating back to 1998 and over $42 billion of assets under management as of March 31, 2024.
VREP III, the third iteration of Goldman Sachs’ dedicated real estate secondaries strategy, closed above its fundraising target with commitments from a global and diverse group of institutional and high net worth investors and a meaningful commitment from Goldman Sachs employees. VREP III represents the largest dedicated real estate secondaries fund ever raised. The firm’s predecessor fund, VREP II, previously closed on $2.75 billion of commitments.
In May, Goldman Sachs Alternatives announced the final close of West Street Real Estate Credit Partners IV ("RECP IV") and related vehicles building on the firm’s decades-long history in real estate credit. The pool of capital represents over $7 billion of real estate lending capacity including leverage, and together with capital raised for VREP III represents over $10 billion of liquidity-oriented real estate capital available for deployment, from separate parts of the firm’s investment platform.
Harold Hope, global head of Vintage Strategies at Goldman Sachs Alternatives, said: “We believe the current market environment represents one of the most compelling deployment opportunities that we have observed in real estate secondaries. As the largest dedicated real estate secondaries fund raised to date, VREP III will be well-positioned to capitalize on increasingly attractive opportunities, in a market where size is a meaningful competitive advantage. We are grateful to both our existing and new investors, and thanks to their support our team will be unconstrained when it comes to pursuing real estate secondary transactions of all sizes.”
The success of the fundraise reflects the recognition of the Vintage team’s 25-year track record which includes 14 years of experience investing in real estate secondaries, as well as the attractive market opportunity. Demand for liquidity across both LPs and GPs of private real estate funds is high as a challenging exit environment for the asset class has resulted in a significant slowdown in distributions in recent years. Additionally, rising interest rates have impacted the availability of affordable financing and market participants are increasingly turning to the secondary market in search of alternative liquidity solutions.
“Demand for real estate secondary solutions across both LPs and GPs is at an all-time high, driven by the turmoil in global real estate markets and a strong need for liquidity” says Sean Brenan, who leads real estate investing activity for the Vintage Strategies. “We believe the pressure on real estate is here to stay for the foreseeable future, and we are hopeful that this capital will enable us to continue to be a partner to real estate market participants who need innovative capital solutions to help alleviate some of their liquidity needs.”
The Vintage team is differentiated by its longstanding experience executing both traditional LP secondary transactions and non-traditional secondary solutions (e.g., continuation vehicles and portfolio finance) across asset classes, as well as its ability to leverage the broader resources of Goldman Sachs to source, evaluate, and execute these investments.1
Since inception of the strategy, the Vintage team has deployed over $8.9 billion to 165 real estate secondary transactions. In 2023 the team evaluated $56.8 billion of real estate secondary deal flow.
About Vintage Strategies at Goldman Sachs Alternatives
Goldman Sachs (NYSE: GS) is one of the leading investors in alternatives globally, with over $450 billion in assets and more than 30 years of experience. The business invests in the full spectrum of alternatives including private equity, growth equity, private credit, real estate, infrastructure, hedge funds and sustainability. Clients access these solutions through direct strategies, customized partnerships, and open-architecture programs.
The business is driven by a focus on partnership and shared success with its clients, seeking to deliver long-term investment performance drawing on its global network and deep expertise across industries and markets.
The alternative investments platform is part of Goldman Sachs Asset Management, which delivers investment and advisory services across public and private markets for the world’s leading institutions, financial advisors and individuals. Goldman Sachs has over $2.8 trillion in assets under supervision globally as of December 31, 2023.
Established in 1998, Vintage Strategies at Goldman Sachs Asset Management is one of the largest secondaries investors in the world and has invested over $70 billion of capital since inception and has been a pioneer in the industry. The business provides liquidity, capital and partnering solutions to private market investors and managers worldwide across a range of private market strategies.
1 Goldman Sachs Asset Management leverages the resources of Goldman Sachs & Co. LLC subject to legal, internal and regulatory restrictions.