Active in European real estate markets since 2019, Bain Capital was involved in some of the biggest deals signed in Paris in 2025. After deploying more than €1 billion last year on the Old Continent, the American asset management company intends to forge ahead.
"Bain Capital was founded in 1984 in Boston by a group of former Bain & Co. consultants who decided not only to contribute their operational expertise to the companies they advise, but also to invest directly, in partnership with their managers to contribute to their growth and improvement,” Rafael Coste Campos, partner at Bain Capital, reminds us right away, when presenting the American giant, whose €220 billion in assets under management make it the largest unlisted investment manager in the world.
Bain has 28 offices around the world and has been present in Europe for nearly 30 years. Coste Campos continues: “Our real estate strategy in Europe currently represents more than $3 billion in invested equity, which would translate into a gross development value of $12 to $13 billion in the long term.”
Proof of its strong appetite for European real estate and its desire to accelerate in the sector is Bain's deployment of nearly €1.4 billion in capital there in 2025, and it intends to maintain a similar pace of investment again this year. “Around 80% of our European real estate strategy has so far been achieved through direct investments, through joint ventures carried out alongside local partners or through operational platforms that we own,” adds Coste Campos, according to whom the group's strategy is to take advantage of the local expertise of professionals in the field, who are specialists in their sectors.
“We act alongside partners and locals, whether to find opportunities or manage assets, because we can't replicate 20 or 30 years of local expertise in every submarket and asset class," he explains. "We are looking for very solid expertise, but also an alignment of interests through a co-investment in which we remain the majority investor.”
“The remaining 20% concern what we call 'Capital Solutions,' tailor-made instruments with certain credit characteristics, but also an upward convexity that we make available to real estate companies,” he adds. In this respect, he cites as an example the transaction of around €150 million conducted last year in France with Hôtels de Paris, “where we granted a loan with a stake in order to remove the company from the judicial administration procedure, carry out a capex plan on assets and improve the operational functioning of the establishments, while supporting the current management team and shareholders.”
Targeting market dislocations
From a sector perspective, “we strive to be thematic investors — and this has always been in the DNA of Bain Capital throughout its history — by targeting specific asset classes that we believe are supported by headwinds and an imbalance between supply and demand,” says Coste Campos.“Today, the four asset classes in which we are most present are data centers, logistics, hotels and residential,” explains Coste Campos. "And we approach these themes differently depending on the country and the fundamentals of the market.”
Defining itself as a value-added, even sometimes opportunistic investor — its various current capital expenditure plans total €2 billion — the management company remains above all on the lookout for opportunities for strong value creation. “A recurring theme for us has been the conviction that when there is a market dislocation, the time is right to sign unique assets that could not be purchased otherwise,” says Coste Campos, before adding: “The other important pillar of our strategy over the last 18 to 24 months has been to buy very good assets with lower valuations due to market dislocation.”
It is with this in mind that Bain Capital partnered with the French asset management company Black Swan Real Estate Capital and the British investment manager in London, Revcap, to acquire from Icade the 29-33 Champs-Élysées for €402 million, following a highly competitive three-round call for tenders orchestrated by Newmark and Lazard.
“We were able to buy an asset on the Champs-Élysées at a price that, in our opinion, reflects a value-added return,” Coste Campos says, stressing the opportune market moment in which this transaction was completed. “All the other owners on the Champs-Élysées are long-term investors who will probably never sell their assets, such as QIA, LVMH, Norges Bank or Pontegadea," he notes. "And if this asset had been sold between 2019 and 2021, it would have been sold to core capital.”
But a more gloomy market environment and certain complexities related to the property remain: “It still needs to be renovated and re-leased,” he says, which could, according to him, discourage some core buyers. “Our bet is that within two to three years, once active, repositioned and re-marketed, many of them will have wished they had acquired it. In this way, we believe we can create a 'yield-on-cost' return of 6%.”
The transaction also shows that, while Bain Capital does not include office and retail in its preferred playing fields, the American investor is not reluctant to venture out when the right opportunity arises. “Since the Covid-19 pandemic, offices have bifurcated in most major European cities, where rental values for the best products are rising rapidly due to a lack of new supply, but where secondary markets are seeing their vacancy rates skyrocket and are experiencing a destruction of considerable value, not only due to the fall in rents, but also to the increase in capitalization rates,” observes Coste Campos. The investor thus intends to guide its strategy by taking advantage of the lessons of the past: “During the global financial crisis, those who were very successful were not those who sought the most depressed valuations and secondary assets, but those who bought 'prime' assets in the best European cities. Because when the market recovers, these assets recover more strongly and more quickly.”
France is a key market
After a particularly active year in France, Bain Capital now manages around €2 billion in assets in France, divided between positions: 29-33 Champs-Élysées; the Hotel Pullman Paris Montparnasse, acquired at the end of last summer from Unibail-Rodamco-Westfield, in partnership with Columbia Threadneedle and QuinsPark Investment Partners; the Hôtels de Paris group, as well as the Mercurial Towers de Bagnolet, acquired alongside the French investor Hemisphere in 2022.
“France is one of the three largest markets in Europe, so it is a key market for us on which we want to develop in the years to come,” adds Coste Campos, noting that his group has so far adopted a rather opportunistic approach.
“Our four acquisitions all had one thing in common: imperfect markets and sellers who were more or less motivated,” he points out. For Hôtels de Paris, receivership; for Pullman Paris Montparnasse, the URW arbitration plan that targeted its non-strategic assets; and for 29-33 Champs-Élysées, Icade's desire to reduce its debt and its difficulty in successfully repositioning. “All these transactions have in common the fact that we are building unique trophy assets through a build-to-core approach,” he underlines.
Even the Mercurial towers represent “the largest coliving and student housing project in Europe," Coste Campos says. After obtaining a permit for a change of use from office to managed residential, one tower will house a student residence and the other will house coliving. Bain Capital is currently waiting to see its permits approved and could begin construction as early as this summer, with delivery expected about two years later.
And the political and macroeconomic uncertainty that currently reigns in France is not likely to distract Bain Capital from France, assures Coste Campos. On the contrary, “we are very aware of the potential macroeconomic risks, but people like us, who can be at odds and who are really looking for relative value, tend to be more active in times like this.”