Ares Management Expands Global Footprint with Walton Street Deal
Ares Management Expands Global Footprint with Walton Street Deal
Ares Management Corporation (NYSE: ARES) has officially announced an exciting new chapter for its investment strategy. Ares has entered into a definitive agreement to acquire 100% of Walton Street Capital Mexico S. de R.L. de C.V. This acquisition marks a significant move in enhancing Ares' presence in the industrial sector of real estate management.
Walton Street - A Leader in Industrial Real Estate
Walton Street Mexico has established a strong reputation as a premier real estate asset management platform. With a remarkable $2.1 billion in assets under management as of mid-2024, Walton Street has been active in the Mexican market for over 20 years. Under the leadership of Federico Martin del Campo, the team comprises more than 15 seasoned investment professionals with vast experience in the industrial domain.
Strategic Growth and Vision
With a proven track record, Walton Street Mexico has successfully acquired and developed more than 51 million square feet of industrial real estate across more than 250 properties since 2010. This extensive background allows Ares Real Estate to harness Walton Street’s profound local knowledge and market capabilities, as it positions itself to expand its industrial portfolio even further.
Ares Real Estate's Robust Strategy
Ares Real Estate has been focusing on a strategic expansion in key markets and sectors. As of June 30, 2024, Ares has built an impressive industrial real estate portfolio valued at $28.1 billion, encompassing over 230 million square feet across the U.S. and Europe. The addition of Walton Street's expertise will undoubtedly enhance Ares' global industrial operations.
Industry Insights and Opportunities
Michael Arougheti, CEO and President of Ares, expressed enthusiasm regarding the acquisition, stating that Walton Street Mexico's insights will significantly contribute to Ares’ growth initiatives. As global supply chain dynamics change, Mexico is increasingly seen as a favorable destination for skilled manufacturing, which is expected to drive demand for industrial warehousing in the region.
The Team's Integration and Future Goals
The Walton Street Mexico team will integrate into Ares’ extensive global Real Estate team, which manages $52 billion in assets and employs over 270 investment professionals. This synergy promises to enhance Ares' capabilities across various strategies and geographies, ultimately fostering growth in the industrial sector.
Market Timing and Strategic Positioning
David Roth, Co-Head of Ares U.S. Real Estate, articulated the strategic timing of this acquisition, emphasizing its importance as Ares seeks to bolster its offerings in the industrial real estate market, which continues to show significant growth prospects across North America.
Looking Ahead
As Ares Management moves forward with this transaction, it is anticipated to enhance Ares’ after-tax realized income for both Class A and non-voting common stock holders. The deal is expected to close within the upcoming fourth quarter of 2024, pending various customary approvals.
The integration of Walton Street into Ares is seen not only as a growth opportunity but also as a way to better serve clients and maximize investment strategies in the increasingly dynamic real estate landscape.
Frequently Asked Questions
What is the purpose of Ares' acquisition of Walton Street Mexico?
The acquisition aims to expand Ares Management's footprint in the industrial real estate sector and leverage Walton Street's expertise and local networks.
How significant is Walton Street Mexico in the real estate industry?
Walton Street Mexico is a leading player in the industry, managing approximately $2.1 billion in assets as of mid-2024 and involved in over 250 properties.
What is Ares Management's strategy in real estate?
Ares focuses on strategic expansion in key markets and sectors, emphasizing long-term structural tailwinds to maximize investment returns.
What benefits does Walton Street bring to Ares Management?
Walton Street brings over 20 years of experience in the industrial sector, which complements Ares' existing portfolio and offers insights into market trends.
When is the expected closing date for the transaction?
The transaction is expected to close in the fourth quarter of 2024, contingent upon customary closing conditions and regulatory approvals.
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