APRIL ISSUE: Institutional Clout

TIAA-CREF’s Thomas Garbutt finds new frontiers.

TIAA-CREF’s Thomas Garbutt Finds New Frontiers

By Paul Rosta, Senior EditorGarbutt_Final

In 1934, as the Great Depression deepened, TIAA-CREF made its first investment in commercial real estate. That same year, on the other side of the Atlantic, the predecessor of Henderson Group plc was launched in London. Eighty years later, the two venerable institutional investors are joining forces in a $63 billion joint venture that promises to make its presence felt on three continents.

The initiative emerged from about 18 months of conversations among the two companies’ leaders, reported Thomas Garbutt, who is leading TIAA-CREF’s role in the joint venture as CEO of the investment management firm’s global real estate unit. “We liked what we saw as far as the way they ran their business,” he said. “We really came to the same conclusion together.” He cites such elements as a similar client-first ethic, complementary goals, dedication to research and compatibility of leadership.

Dubbed TIAA Henderson Global Real Estate, the joint venture’s stated mission is to pursue both core and value-add investment opportunities across a wide variety of real estate product types. Expected to close by the end of the first quarter, it combines TIAA-CREF’s European real estate business with Henderson’s real estate enterprises in Europe and the Asia-Pacific region. TIAA-CREF owns a 60 percent stake in the joint venture, and also took sole ownership of Henderson’s real estate business in the U.S., thereby broadening the international reach of both firms. Headquartered in London, the joint venture operates additional offices in North America and Europe.

Read the full interview in the April 2014 issue of CPE. Access is free!