Weekend Wrap: Apollo Global's RE Operations Can't Keep Up

Apollo Global Management LLC late this week reported solid results for the third quarter ended Sept. 30, 2013.

But its real estate operations lagged the rest of the investment management firm’s portfolio, badly.

The New York-based firm,with interests in private equity, credit markets and real estate, reported that its Economic Net Income after taxes—a non-GAAP measure which includes management fees, advisory and transaction fees and carried interest income—increased to $528.6 million in 2013’s third quarter ended Sept. 30, from $379 million in the same period a year ago.

The increase, it says, “was driven by favorable performance” its "Incentive Business," where the third quarter ENI of $552 million compared with 2012’s $380.4 million, and was attributed to higher carried interest income from Apollo's private equity segment.

Apollo's total assets under management grew to $112.7 billion at the end of the third quarter, up $3 billion from the Sept. 30, 2012, total.

But Apollo's real estate segment had an economic net loss of $3.1 million for 2013’s third quarter, compared to a $1.7 million loss in the year-earlier period. Total third quarter real estate-segment revenue was $16.7 million, a 6% increase over the 2012 period in 2012.

The company describes its four principal real estate funds and its operations in the area on its website here.

Still, its portfolio is growing.  As of Sept. 30, 2013, Apollo's managed $9.3 billion in real estate holdings, compared to $8.1 billion a year ago.

 

You can read Apollo's earnings report here.

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