MW Apollo fills real-estate gap with $1.5 billion Bridge Investment deal

By Steve Gelsi

Private-equity firm adding $50 billion of AUM into its real-estate portfolio

Apollo Global Management Inc. has become one of the largest private-equity firms in the world by focusing on equity and debt investments as well as managing assets for the insurance sector.

Compared with rival Blackstone Inc. $(BX)$ and KKR & Co. Inc. $(KKR)$, Apollo hasn't had a large chunk of its assets in real-estate investments - until now.

Apollo $(APO)$ said Monday it will pay $1.5 billion in stock to buy Bridge Investment Group Holdings Inc. (BRDG) in a move that will add $50 billion in assets under management (AUM).

Apollo's stock rose fractionally in premarket trading, while Bridge Investment's stock jumped 31%.

KKR has $79 billion in real estate AUM, while Blackstone Group's real estate AUM of $315.4 billion is nearly as big as its private-equity AUM.

Apollo Partner David Sambur said Apollo's real-estate business is one component of the firm that's "growing but not yet at scale."

Apollo aims to "further augment" its real-estate capabilities while working to scale up Bridge's products through its investment platform.

Bridge's stockholders will get 0.07081 shares of Apollo stock for each share of Bridge Class A common stock.

The deal values Bridge at $11.50 a share, a premium over its closing price of $7.92 a share on Friday.

Apollo doesn't currently break out its total real-estate assets in its total AUM of $750 billion.

However, its Apollo Commercial Real Estate Finance Inc. unit has about $9 billion under management and its Apollo Diversified Real Estate Fund/Apollo Diversified Credit Fund has about $7 billion.

Apollo Diversified Real Estate Fund is part of the firm's offerings for affluent individuals.

Founded in 2009, Bridge employs 300 investing pros who manage a portfolio mostly of high-quality real-estate assets for institutional and wealth clients.

Ahead of the deal, Apollo's stock had fallen 8.9% so far in 205, as of Friday's close. The S&P 500 SPX is up 2.2% so far this year.

Bridge Investment Group's stock was down 5.7% so far this year.

-Steve Gelsi

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February 24, 2025 08:51 ET (13:51 GMT)

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