PGIM Real Estate Secures $2 Billion for GDCF

PGIM Real Estate, the world’s third-largest real estate investment manager with headquarters in the US, has completed the fundraise for its first Global Data Center Fund (GDCF) with $2 billion of capital allocated to the strategy. PGIM Real Estate secured capital commitments for the GDCF from a range of global investors.

The Fund has a build-fill-sell investment strategy focused on the low latency hyperscale segment of the global data center sector, targeting opportunistic investment returns.

Since its first close in July 2023, the GDCF has been developing a geographically diversified portfolio of assets targeting investments across the major global data center markets of North America, Asia Pacific and Europe.

The Fund is managed by a global portfolio management team led by Global Head of Data Center Investments Morgan Laughlin and PGIM Real Estate has over a decade of experience investing in the sector.

The GDCF strategy creates value through asset-level development joint ventures with leading data center operators. Retaining an operator-independent approach allows the Fund to access attractive investment opportunities in supply constrained markets through its deep range of operator relationships. ESG considerations are factored into each investment decision with a defined asset allocation to buildings with a green building certificate.

As well as raising capital amongst institutional investors, PGIM Real Estate entered into a distribution partnership with a leading global private bank to raise assets globally for the Fund.

Important Milestone

Morgan Laughlin, Global Head of Data Center Investments, PGIM Real Estate, said that successfully reaching the $2 billion target raise is an important milestone that reflects strong investor confidence in the sector and the company’s strategy.

He added: “Data centers are at the heart of the digital framework that is playing an increasingly critical role across our economy and society. In line with the recognition of the importance of digital infrastructure in our modern lives, global investors are rapidly increasing their exposure to the sector.”

To date, over $450 million of equity capital has been committed to data center investments across PGIM Real Estate, and GDCF retains a strong pipeline of opportunities that is expected to allow it to deploy the remaining capital within the next 18 months.

PGIM Real Estate co-CEO Raimondo Amabile said that they see a significant opportunity to develop expertise in the data center space and create a wider digital infrastructure platform. Data centers, and other associated digital infrastructure, offer a generational investment opportunity as the digital demands of our societies and economies continue to expand at an astounding pace.

PGIM Real Estate has $206 billion in gross assets under management and administration, and real estate professionals located in 35 cities worldwide.

The company strives to integrate sustainable best practices throughout its investment, asset management, risk and talent management processes for the benefit of clients, employees, and the communities in which it operates.