Mitsubishi buys stake in private equity real estate firm Patron
The Tokyo-based group's investment management business, Mitsubishi Estate Global Partners, is acquiring the stake from Patron's management led by founder Keith Breslauer, according to a statement Thursday. The deal will see Mitsubishi commit about €600 million (¥99.5 billion) of equity to Patron's funds to help it build out new strategies including its nascent credit business, it said.
It is the latest example of European private equity real estate platforms being snapped up by larger global investors as their founders ponder succession and grapple with a regulatory landscape that can make it harder for small firms to compete. New York Life Insurance's Candriam Group took control of Tristan Capital Partners in 2023 while Aermont Capital sold a stake to Singapore-based Keppel Capital Holdings.
"I'm not going anywhere,' Breslauer said in an interview. "We are getting a very large check and backing from a very long-term, strategic-thinking partner.' A team of senior partners led by him will continue to manage Patron's operations, according to the statement.
Japanese investors have been snapping up a series of overseas investment firms in recent months, particularly those focused on alternative assets. Last month, insurer Dai-ichi Life Holdings announced plans to boost its stake in hedge fund manager Capula Investment Management and acquire a 15% interest in M&G.
They have also been active buyers of U.K. real estate with Sotetsu Urban Creates and Yasuda Real Estate acquiring an interest in Deutsche Bank's U.K. headquarters and Nomura Real Estate Development forming a venture to build rental housing.
Breslauer, a former Lehman Brothers banker, founded Patron in 1999 and built the business into a pan-European investment manager with about €5.3 billion of capital, including an almost €1 billion fund it raised last year. The firm had two Japanese investors in its most recent fund — a number Patron will aim to grow with the next vehicle that's likely to raise capital later this year.
Mitsubishi is one of Japan's largest property companies and the firm has been growing its investment management business, which in the U.S. includes TA Realty. The firm now oversees about $39 billion, according to its website.
"I had over 60 approaches,' Breslauer said. "I really wanted to be part of a group that was in the property business, not an insurance company.'
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