Key Takeaways
- • Harrison Street Real Estate Capital is raising $1.5 billion for its eighth flagship fund focused on life science, healthcare service, and senior housing properties, with the Korean Teachers' Credit Union committing $100 million and multiple South Korean financial services companies expected to make similar-sized commitments.
- • The Chicago-based alternative real estate firm, which manages approximately $33 billion in assets under management, recently acquired a portfolio of 24 senior housing communities in California and Nevada from Oakmont Management Group for approximately $1.2 billion, signaling aggressive deployment in the sector.
- • Life science and healthcare real estate are outperforming traditional asset classes during the extended pandemic environment, with strong rental demand, low vacancy rates, and emerging institutional investor interest positioning them as a niche market opportunity.
- • South Korean institutional capital is increasingly targeting life science real estate vehicles, following the National Pension Service's $500 million commitment to Blackstone's life science fund earlier in 2021, indicating growing LP appetite for this sector.
Summary
Harrison Street Real Estate Capital has secured a significant Korean institutional investor commitment for its new flagship fund targeting life science and healthcare properties. The Korean Teachers' Credit Union has committed $100 million to the eighth flagship fund, which aims to raise $1.5 billion total, according to reporting from the Maeil Business Newspaper. Multiple additional South Korean financial services companies are expected to make comparable commitments to the vehicle.
The timing of the fundraising effort coincides with Harrison Street's continued portfolio expansion in the healthcare sector. Earlier in June 2021, the firm announced its acquisition of a 24-property senior housing portfolio operated by Oakmont Management Group across California and Nevada for approximately $1.2 billion. This deployment reflects broader institutional confidence in healthcare and senior housing real estate as pandemic-era performers.
Harrison Street, founded in 2005 and based in Chicago, has built a diversified alternative real estate platform managing roughly $33 billion in assets under management. The firm's investment focus spans senior housing, student housing, healthcare delivery, life science facilities, storage real estate, and social and utility infrastructure. Life science properties, including medical laboratories and healthcare-related facilities, have demonstrated resilience during the prolonged pandemic environment, with institutional investors increasingly targeting these assets due to solid rental demand and low vacancy rates compared to traditional office properties.
The inflow of South Korean capital into life science real estate reflects a broader institutional shift toward the sector. The National Pension Service, South Korea's largest pension fund, committed $500 million to Blackstone's life science real estate fund earlier in 2021—marking its first investment in a vehicle dedicated to life science properties. This trend underscores growing recognition among sophisticated LPs that life science and logistics-focused real estate represent attractive defensive and growth-oriented investments amid broader commercial real estate uncertainty.
The timing of the fundraising effort coincides with Harrison Street's continued portfolio expansion in the healthcare sector. Earlier in June 2021, the firm announced its acquisition of a 24-property senior housing portfolio operated by Oakmont Management Group across California and Nevada for approximately $1.2 billion. This deployment reflects broader institutional confidence in healthcare and senior housing real estate as pandemic-era performers.
Harrison Street, founded in 2005 and based in Chicago, has built a diversified alternative real estate platform managing roughly $33 billion in assets under management. The firm's investment focus spans senior housing, student housing, healthcare delivery, life science facilities, storage real estate, and social and utility infrastructure. Life science properties, including medical laboratories and healthcare-related facilities, have demonstrated resilience during the prolonged pandemic environment, with institutional investors increasingly targeting these assets due to solid rental demand and low vacancy rates compared to traditional office properties.
The inflow of South Korean capital into life science real estate reflects a broader institutional shift toward the sector. The National Pension Service, South Korea's largest pension fund, committed $500 million to Blackstone's life science real estate fund earlier in 2021—marking its first investment in a vehicle dedicated to life science properties. This trend underscores growing recognition among sophisticated LPs that life science and logistics-focused real estate represent attractive defensive and growth-oriented investments amid broader commercial real estate uncertainty.
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