Key Takeaways
- • North Dakota Retirement and Investment Office (RIO) commits $75 million to Ares U.S. Real Estate Fund XI, a closed-end, value-added real estate strategy targeting U.S. growth markets.
- • Ares U.S. Real Estate Fund XI aims to raise $2.6 billion in total equity, representing a 100% increase over its predecessor fund, which closed at $1.3 billion in 2022.
- • The fund's investment thesis focuses on U.S. markets with diversified economies, developed transportation infrastructure, long-term growth potential, and high barriers to entry.
- • North Dakota RIO, with approximately $25.9 billion in total assets under management, continues to allocate capital to institutional real estate vehicles as part of its institutional investment portfolio.
Summary
The North Dakota Retirement and Investment Office has committed $75 million to Ares U.S. Real Estate Fund XI, marking a significant institutional capital deployment into the alternative real estate sector. The fund represents Ares Management's latest generation value-added real estate vehicle, structured as a closed-end fund targeting opportunistic and value-add strategies across U.S. markets.
Ares U.S. Real Estate Fund XI is targeting $2.6 billion in total equity commitments—a substantial 100% increase compared to its predecessor vehicle, Ares U.S. Real Estate Fund X, which closed at $1.3 billion in 2022. This fund-size expansion reflects growing institutional investor appetite for value-added real estate strategies in the current market environment.
The fund's investment strategy is geographically and economically diversified, focusing on U.S. growth markets that demonstrate multiple competitive advantages: diversified economic bases, well-developed transportation networks, demonstrable long-term growth potential, and structural barriers to entry. This approach targets markets positioned to outperform during both economic expansion and contraction cycles.
North Dakota RIO, with approximately $25.9 billion in assets under management, serves as the investment vehicle for the state's public pension system. The $75 million commitment represents a measured allocation consistent with the fund's role as a public pension investor seeking exposure to institutional-quality real estate with value-creation potential through active management.
Ares U.S. Real Estate Fund XI is targeting $2.6 billion in total equity commitments—a substantial 100% increase compared to its predecessor vehicle, Ares U.S. Real Estate Fund X, which closed at $1.3 billion in 2022. This fund-size expansion reflects growing institutional investor appetite for value-added real estate strategies in the current market environment.
The fund's investment strategy is geographically and economically diversified, focusing on U.S. growth markets that demonstrate multiple competitive advantages: diversified economic bases, well-developed transportation networks, demonstrable long-term growth potential, and structural barriers to entry. This approach targets markets positioned to outperform during both economic expansion and contraction cycles.
North Dakota RIO, with approximately $25.9 billion in assets under management, serves as the investment vehicle for the state's public pension system. The $75 million commitment represents a measured allocation consistent with the fund's role as a public pension investor seeking exposure to institutional-quality real estate with value-creation potential through active management.
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