Tokio Marine Buying Majority Stake in Real Estate Debt Fund Manager Acore Capital

Japanese insurer Tokio Marine Holdings has agreed to acquire a majority stake in Acore Capital, a US investment manager specialising in commercial real estate debt.

Tokio Marine is investing in San Francisco-based Acore through its wholly owned subsidiary Delphi Financial Group, the firms said Tuesday in a release. The deal value wasn’t disclosed. Delphi previously supported Acore’s 2015 launch with a $1.6 billion capital commitment.

One of America’s largest non-bank commercial real estate lenders, Acore manages $18.5 billion in capital across separately managed accounts and commingled funds backed by global institutional investors, according to the announcement. Delphi will give Acore discretion over its $10 billion-plus CRE debt portfolio and support growth in Acore’s third-party investment vehicles through seed capital commitments.

“We are pleased to deepen our long-standing, mutually beneficial relationship with Acore Capital through Delphi, built over many years of close collaboration,” said Yoshiaki Nakahara, managing executive officer and group chief investment officer at Tokio Marine. “This transaction will accelerate the growth of the firm by further enhancing its investment capabilities, infrastructure, and capital markets relationships.”

Data Centre Lending

Acore has originated $42 billion in loans with an average size of $76 million, according to the firm. It targets loans ranging in size from $50 million to more than $300 million.

Acore’s deals have included debt funding of $134 million for the acquisition of a Northern Virginia property for conversion into a 15-megawatt data centre and $125.3 million for a multi-state digital infrastructure portfolio, per the company website. The firm also provides credit for multi-family, warehouse, student housing and hotel deals.

There will be no changes to Acore’s investment management operations, the companies said, and the firm will continue to operate independently under the leadership of CEO Warren de Haan, who said the partnership would accelerate Acore’s growth in the US and internationally.

“This transaction is a powerful endorsement of the platform we’ve collaboratively built over the past decade,” de Haan said. “Partnering more deeply with one of the world’s largest and most sophisticated insurers, enhances Acore Capital’s ability to provide best-in-class investment management for our investors.”

The deal remains subject to customary closing conditions, which the firms expect to be satisfied over the coming weeks.

Private Credit Playbook

Tokio Marine’s private credit expansion comes after fellow Japanese group Tokyu Land teamed with US investment manager Kennedy Wilson in April to launch a preferred equity and mezzanine real estate investment platform. The partners aim for over $200 million in investments with a focus on preferred equity bets and mezzanine loans to sponsors of multi-family and industrial projects across the US, targeting deals of $10 million to $50 million.

In June, Nuveen announced the second closing of its Australia real estate debt strategy with A$650 million ($421 million) in committed capital, including a new investment of A$300 million from the Canada Pension Plan Investment Board. CPPIB invested alongside the strategy’s existing partners, Nuveen parent company TIAA and Singapore state holding firm Temasek.

Also in Australia, private equity major Warburg Pincus in October of last year revealed its A$490 million commitment to MA Financial Group’s A$1 billion private credit platform targeting the country’s residential real estate sector. Then in March, rival Blackstone announced a $8 billion capital raise for a real estate debt fund with Australia among the target markets.