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LaSalle Scales Up Real Estate Business With Acquisition From Aviva

The real estate manager is buying Aviva’s $7 billion multi-manager business and will take over a jointly managed fund that invests in Europe.

LaSalle Investment Management is expanding its real estate empire.

The firm announced Wednesday that it had agreed to purchase the real estate multi-manager business of rival Aviva Investors, in a deal expected to close by the end of the year. The addition of the Aviva business, which has $7 billion of assets under management, will make LaSalle one of the five largest global managers in non-listed indirect real estate, according to the announcement.

As part of the deal, Ed Casal, chief executive officer of Aviva’s real estate business, will join LaSalle, where he will oversee the multi-manager division. Casal will also join LaSalle’s global management committee. 

“A strong multi-manager capacity has become increasingly important to LaSalle’s clients,” LaSalle CEO Jeff Jacobson said in the company statement. He added that the acquisition would give LaSalle stronger capabilities for third-party fund investing, joint ventures, and co-investments. 

[II Deep Dive: LaSalle Predicts 'Goldilocks' Real Estate Market in 2018]

For its part, Aviva said it would focus on direct operations within real assets, according to a statement from CEO Euan Munro.

In addition to the multi-manager business, LaSalle said it had also purchased Aviva’s share of Encore+, a €1.7 billion ($2 billion) open-ended fund investing in real estate in continental Europe. Aviva and LaSalle had jointly managed the fund for the last eleven years.

“We have always considered Encore+ as our flagship diversified open-end fund in continental Europe and I am delighted that we will become the sole manager for the fund,” Jacobson said.

LaSalle had about $60 billion of private and public equity and private debt investments as of the first quarter. The firm's non-listed indirect real estate business will increase to about $10 billion after the deal with Aviva is completed, according to the announcement.

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