KKR is retooling its real estate ambitions after falling just short of its own lofty benchmark. Despite securing fifth place in PERE's 2025 ranking of global real estate managers, the firm's leadership has made it clear that the top three are the only acceptable spots.
"We have a firm objective to be one, two, or three in anything we do," KKR Real Estate Global Head of Real Assets Raj Agrawal recently told PERE.
To that end, the company has spent the past year overhauling its business, merging its infrastructure and energy operations into a unified real assets platform and reassessing everything from product offerings to staffing and market strategy.
"We want to take even more market share over the next 10 to 15 years and not just run in place," Agrawal explained.
"We took the opportunity of this to come together to reevaluate our real estate strategy, product slate, staffing, go-to-market. And this has been a dialogue and action plan that we really have been in all year long."
According to Agrawal, KKR has made greater headway scaling its operations in the U.S. than in Asia and Europe, where its business remains "relatively newer." Yet the broader real estate market has proven tough terrain.
"Real estate has been a more challenged asset class for our space in the past few years," KKR CFO Robert Lewin said during the company's presentation at the Bank of America Financial Services Conference on February 10, 2026, according to a transcript provided by S&P Global Market Intelligence.
That view was echoed by Fitch Ratings' Dafina Dunmore, who told PERE that performance "has been challenged across the peer group, just giving the broader macro issues and challenges that all of the asset managers face."
Even so, Lewin pointed to signs of a recovery. He said that real estate values appeared to have bottomed out over the last 12 to 18 months, creating an opening to invest in core properties on an unlevered basis.
"We saw the ability to achieve very attractive rates of return on an unlevered basis in what we deem to be very low risk in core real estate properties because there just was a dearth of core real estate capital," he said.
During KKR's Q4 2025 earnings call on February 5, Lewin added, "Most of the competition [were] either core plus capital, but more likely value-added capital at a much higher cost of capital. And so, we leaned in, in early mid-2024, when we thought valuations really troughed, number one; number two, there was limited competition."
He also told attendees at the UBS conference on February 9 that the firm now manages about $85 billion in global real estate assets, split roughly evenly between equity and credit. Over the past year, he said, liquidity in the credit market has improved and transaction volumes have begun to rebound.
As the firm refines its long-term growth plan, KKR Real Estate Partner and President Chris Lee distilled the company's approach to its essence.
"Scale is the output," he told PERE. "It's an output of performance. And so, if we do our job well and perform, we will attract more capital, more deal flow, and scale."
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