By Jon Peterson
San Francisco-based DivcoWest has been contacted by several firms to explore the possibility of the real estate investment firm selling a partial stake in the company. Bloomberg has reported that Blue Owl Capital Inc.’s Dyal Capital is in talks with DivcoWest about a potential transaction. Other investment firms besides Dyal Capital have also asked about buying a stake in the company, according to industry sources.
There is no assurance that DivcoWest will ever work out a transaction with any firm to sell a portion of the company to another investor. DivcoWest declined to comment when contacted for this story.
DivcoWest has been a very strong and successful real estate investment firm in both commingled funds and separate accounts with major institutional investors. Its last capital raise for a commingled fund was for $2.25 billion in October 2020 for DivcoWest Fund VI. It also formed a new separate account with the California Public Employees Retirement System (CalPERS) last year to invest in life science properties. The amount allocated to the partnership by the pension fund was $500 million.
DivcoWest has been a major real estate investor across a number of important and growing markets in the United States. Founded in 1993, the company has invested from Silicon Valley to Cambridge, Mass., and it has been a prominent player in commercial real estate across the West Coast from Southern California to the Pacific Northwest. DivcoWest also has active investments in Texas and North Carolina. The company is headquartered in San Francisco, but it has offices in Cambridge, New York, Los Angeles, Menlo Park and Washington, D.C.
The company has total assets under management of $16.2 billion through the end of last year, according to its website. The firm mostly looks to acquire office buildings that have a value-add component, which can be traditional office or life science properties. Other targeted property types include industrial and residential assets.