Continental Realty Corporation (“CRC”),a real estate investment and management company, in partnership with Brown Advisory, a global private and independent investment management and strategic advisory firm, have announced the closing of Core Multifamily Fund, LP (the “Partnership”), for which approximately $146 million in private equity funds were raised. Since 2012, CRC has raised $850 million in equity across five real estate funds focused on multifamily and retail investments. Through the various funds, CRC has acquired approximately $1.5 billion worth of retail and multifamily assets. Approximately 70% of the $850 million raised has been placed, with another 10% of equity allocated to deals currently under contract.
CRC owns and manages a diversified portfolio of over 9,000 apartment homes, as well as retail centers and other commercial properties consisting of more than six million square feet of commercial space across ten states, with a portfolio value exceeding $3.2 billion. The Partnership is an open-ended fund that was formed to create a long-term vehicle for core multifamily investment and will acquire a diversified, high-quality portfolio of income-generating multifamily properties located in high-growth Southeastern US markets.
“The Core Multifamily Fund provides our team ongoing capacity to acquire newly constructed Class A assets in the Southeast region of the country where we have been investing since 1996,” explained JM Schapiro, CEO of CRC. “Given our deep understanding of the Southeast markets and current market conditions, especially the job and population growth in the Southeast, our vertically integrated team believes this is the optimal time to invest in a core multifamily strategy for long-term holds. Continental Realty and Brown Advisory have a nearly 30-year track record together and we are grateful for this important strategic relationship.”
Target characteristics for multifamily assets in this fund include Class A garden and mid-rise communities built within the past four years, with a focus on stabilized or near-stabilized opportunities. The Partnership will target well-constructed properties with top-quality finishes and amenities throughout Southeast suburban and urban submarkets.
“Multifamily real estate performance correlates positively with population and job growth, and by investing in high-growth markets, properties acquired by this fund could benefit from submarket growth that is stronger than the national average,” stated Ari Abramson, CRC’s Vice President of Acquisitions. “We believe multifamily properties benefit from attractive long-term supply/demand dynamics, and current multifamily fundamentals are strong. Historically, real estate has outperformed public equities and fixed income during periods of rising inflation. Most investments will be capitalized with long-term fixed rate debt. CRC has deep relationships within the lending community and is a Fannie Mae and Freddie Mac Preferred Borrower as well as a HUD-approved borrower.”
Abramson adds that his acquisitions team has a long history of investing in the core multifamily asset class. Since 2017, CRC has acquired 3,200 multifamily units. This includes more than 1,000 units of newly developed and best-in-class properties through five off-market transactions located in Raleigh, Charlotte, and Charleston. These properties include Edison Lofts and St. Mary’s Square in Raleigh, The Flats at Ballantyne and Park & Kingston in Charlotte and Central Island Square in Charleston. CRC expects to buy similar properties through this Partnership.
