Nuveen hits first close milestone for Australian RE debt fund

Nuveen has raised more than $400 million in its initial equity raising round for its commingled Australian commercial real estate debt strategy.

The first close milestone was achieved with anchor investments of more than $400 million from Nuveen’s parent firm, the Teachers Insurance and Annuity Association of America (TIAA), and Temasek, a global investment company headquartered in Singapore.

Nuveen expects this total investment to increase via an additional pipeline of funds from other global investors who are currently progressing through due diligence.

The debt strategy focuses on institutional senior and junior secured real estate loan investments in the Australian market, primarily aimed at the industrial, logistics and residential sectors. It takes a more selective approach to retail, office and alternatives across major cities in Australia.

“Our focus is institutional borrowers, conservative lending parameters and prime assets or projects in sectors that benefit most from Australia’s high population growth and limited supply,” said Dugald Marr, head of debt – Australia at Nuveen Real Estate.

The strategy is led by Dugald Marr, Nuveen’s head of debt Australia & New Zealand and leverages expertise from Nuveen Real Estate’s global debt platform and Nuveen Real Estate in Asia teams.

Nuveen notes that investments in the Australian debt strategy will also be influenced and aligned with Nuveen Real Estate’s comprehensive responsible investment processes and ESG factor analysis.

Marr said the Australian commercial real estate debt market “offers investors a compelling blend of stability, attractive yields and strong collateral protection”.

“Australia’s mature market, supported by robust economic foundations, strict regulatory requirements for banks and the need for more alternative capital sources provides a good foundation for long-term investment in this space.

As at 30 September 2024, Nuveen Real Estate manages US$143 billion in assets, with parent firm Nuveen overseeing $1.3 trillion in AUM worldwide.