KKR is moving its infrastructure and real estate assets under the same leadership as it looks to capitalise on converging opportunities between the rapidly expanding investing units.
Raj Agrawal will become global head of real assets, adding day-to-day supervision of the real estate business to his current responsibilities as global head of infrastructure, according to an investor letter seen by Bloomberg.
Global head of real estate Ralph Rosenberg will become chairman of real assets. The infrastructure business will continue reporting to Agrawal, and the real estate business will report to both him and Rosenberg.
A spokesperson for New York-based KKR declined to comment.
The reorganisation coincides with a growing convergence between infrastructure and real estate, exemplified by the boom in demand for data centres that power artificial intelligence. It also shows that many institutional investors treat infrastructure and real estate investing as part of the same strategy.
The newly combined group will be able to pursue logistics, data centres and other areas of “mutual interest”, according to the letter.
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KKR’s real assets platform will have US$157 billion under management across equity and credit. The infrastructure business, which debuted in 2008, has grown to US$77 billion as at Sep 30, up from US$13 billion five years ago. The real estate business started in 2011, has grown to US$80 billion from US$15 billion over the same period.
The infrastructure business returned 18 per cent during the 12 months ended Sep 30, making it the firm’s top-performing segment. Real estate returned 3 per cent over the same period, lagging behind other asset classes, as higher interest rates and a global shakeout in commercial real estate continued to weigh on the business.
KKR’s infrastructure and real estate teams both participated in the firm’s take-private transaction for data centre owner CyrusOne. More recently, KKR said that, through its infrastructure strategy, it’s taking a stake in Gulf Data Hub, one of the Middle East’s largest data centre firms.
KKR has also homed in on climate-related infrastructure investing as a growth area with the newly announced acquisition of Dawsongroup, an asset-leasing business. BLOOMBERG
