Ares Boosts Real Estate AUM with $3.7B GCP International Acquisition
Ares Management Corporation has agreed to pay $3.7 billion for GCP International, the international arm of GLP Capital Partners Ltd, in a deal that will roughly increase real estate assets under management to around $96 billion.
The acquisition, which excludes GCP’s businesses in Greater China, comprises approximately $1.8 billion in cash and the balance in stock. The acquisition is expected to wrap up in the first half of 2025. Ares has secured bridge financing from Morgan Stanley Senior Funding and Citigroup Global Markets to support the move.
GCP International had $44 billion in assets under management as of June 30, with an emphasis on industrial real estate, digital infrastructure, and self-storage.
“As a combined business, we believe that Ares’ and GCP International’s experienced management teams, highly collaborative cultures and investment track records will create a powerhouse in global real assets investing,” said Ares President and CEO Michael Arougheti.
Ares and GCP believe that e-commerce will boost long-term investor demand in the $2 trillion industrial real estate market. Demand for data centers is also increasing, with spending expected to exceed $1 trillion over the next three years due to increases in cloud migration, data security, and AI.
Following the acquisition, Michael Steele, president of GCP International, and other members of the firm’s leadership teams will join Ares, while GCP’s remaining business will continue to operate independently, with a focus on investments in Greater China led by Ming Mei, who will also serve as an Ares partner and senior advisor.
The move comes just weeks after Ares completed its largest real estate fundraise to date, the Ares U.S. Real Estate Opportunity Fund IV (AREOF IV), which raised over $3.3 billion.
Eastdil Secured, Barclays, Goldman Sachs and Wells Fargo Securities acted as financial advisors to Ares, with Latham & Watkins providing legal counsel. On the GCP International side, Citigroup, Morgan Stanley, Greenhill (a Mizuho affiliate), UOB Group, and Deutsche Bank served as financial advisors, while Kirkland & Ellis offered legal counsel.