Investors Are Flying High Over Infrastructure Deals
	Cap Rate Spreads: Indicator of Opportunity?
	High-Profile Consortium Buys Majority of BBVA Spanish Property Assets in Sale-Leaseback
	Annual Green Building Survey, Chance to Win Gift Card

Investing in infrastructure has become a popular strategy for institutional investors wanting to diversify their portfolios, even as they grapple with a challenging economy and turmoil in the capital markets. These infrastructure projects involve transportation, energy and telecommunications.

According to Preqin, a private equity researcher with offices in New York and London, private investment funds, primarily financed with institutional money, have raised $115.2 billion to invest in global infrastructure projects since 2003.

And that figure could nearly double in the future. As of June 2009, the number of funds on the road raising money was at record levels, with 94 funds seeking to raise $96.8 billion on a global basis, making infrastructure investing one of the fastest-growing types of private equity fund types in recent years.

The cap rate spread over the 10-year Treasury yield is normally positive, reflecting the additional risks inherent in real estate assets (Exhibit 1). The risk premium is generally considered necessary to compensate for liquidity, leasing and tenant credit risk.

This risk premium component fluctuates depending on the outlook for the commercial real estate market. We believe this spread can serve as a rough gauge of the relative value of the real estate market.

A consortium of RREEF Alternative Investments, AREA Property Partners and Europa Capital has completed the acquisition of a significant majority of Spanish property assets owned by Banco Bilbao Vizcaya Argentaria (BBVA). The assets, comprising three landmark office assets and 944 bank branches located throughout Spain, will be leased back to BBVA. The purchase price was not disclosed.

“This transaction provided an excellent opportunity to acquire, for our collective investors, quality assets with a strong cash flow from a very highly rated tenant, remarked Ismael Clemente, head of RREEF Spain, in a prepared statement. “It significantly builds on RREEF’s presence in the Spanish real estate market.”

National Real Estate Investor is once again investigating trends in the development and use of Green Buildings. Whether you own, develop or lease green buildings or not, we would like to include your opinions as an industry professional and valued National Real Estate Investor reader. Your answers will be kept completely confidential and used only in tabulation with others. As an added incentive, at the end of the survey you will be given the opportunity to win a $100 Visa gift card.

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