PSERS OPPORTUNISTIC REAL ESTATE PROGRAM ...

EXECUTIVE SUMMARY
Apollo Europe Real Estate Fund III, L.P.
Apollo European Real Estate Fund III, L.P. (the “U.S. Fund”) is a private real estate
investment partnership to be sponsored by Apollo Real Estate Advisors (“Apollo”), which
will invest in real estate assets and portfolios in Europe.
The Fund will be Apollo’s ninth real estate opportunity fund since 1993. Apollo EU Real
Estate Advisors III, L.P. (the “General Partner”) will serve as the General Partner of the
Fund, and its principals and those of its affiliates and certain associated investors will
personally invest at least $15 million in the Fund.
The Fund’s objective will be to provide its partners with superior risk-adjusted returns by
making and managing investments in real estate assets and portfolios in Europe. The
Fund will target a compound annual internal rate of return (“IRR”) on its investments of
between 16% and 20% over a projected two- to seven-year holding period.
An attractive European real estate investment environment continues to be available to
investors with proven real estate expertise, local market knowledge and the ability to
execute sophisticated investment strategies. Apollo’s twelve year track record in Europe
and extensive network of local joint venture partners give it the qualifications and
competitive advantages necessary to successfully invest and manage the Fund. Apollo
expects to continue to apply the investment approach it has employed in the management
of the European investments of the prior funds.
The objective of the Fund is to create a balanced portfolio of opportunistic assets, both in
terms of asset class and geographical spread, across Europe. Appropriate levels of
leverage will be employed to enhance returns. The Fund’s investments will be sourced
and overseen by Apollo’s London office, which currently consists of eighteen
professionals, sixteen of whom are European nationals.
THE SPONSOR
Apollo Real Estate Advisors was founded in 1993 by William Mack, a prominent U.S. real
estate investor, and Apollo Advisors, a private equity firm that has managed in excess of
$25 billion in equity since its formation in 1990. Mr. Mack and the senior partners of
Apollo Advisors recognized opportunities in the distressed property markets in the United
States in the early 1990’s and concluded that an expert team of real estate professionals,
employing active hands-on management, could deliver attractive total returns and
multiples on equity invested to institutional investors. As a result, the first fund, the Apollo
Real Estate Investment Fund, L.P., was established in April 1993 with $500 million of
equity capital.
Since 1993, Apollo has significantly grown its funds under management to approximately
$8.7 billion. Initially focused exclusively on opportunity-style investing, Apollo recently
expanded its offerings to clients with the acquisition of the Value Enhancement Funds
which, acquired in March 2004, are focused on value added opportunities in the United
States of America. Apollo has also continued to expand its real estate lending program
raising a successor fund based on the success of its first real estate mezzanine fund.
Apollo also manages specific joint ventures with institutional investors.
Apollo has been investing in Europe since 1995 and, in 2000, established a dedicated
team in London to source and oversee European real estate investments. This team
currently consists of eighteen professionals, sixteen of whom are European. Apollo’s
PSERS Private Investments
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