Brookfield Asset Management is closing in on an $830m (€770m) self-storage deal in the US.
The asset manager is planning to buy Simply Self Storage for its Brookfield Strategic Real Estate Partners II fund.
The Orange County Employees Retirement System reported the deal, on which Brookfield declined to comment, in a board-meeting document.
The real estate manager will make two separate investments with Simply Self Storage.
An initial contribution of $300m will be followed by a further $200m that Simply Self Storage will use to fund growth opportunities for the company.
The firm will buy individual and small to medium-sized portfolios in secondary markets, as well as develop new assets in primary and secondary markets.
The deal has an estimated forward cap rate of 6.6% – a significant discount to recent portfolio transactions in the sector.
Simply Self Storage, which owns and operates 90 self-storage properties in the US, will retain its existing management.
Brookfield’s latest investment is part of $2.8bn in deals it has already committed to for Partners II.
The manager closed the £105m (€143m) acquisition of City Gate House office building in London at a 6.1% cap rate.
An equity contribution of $90m has been split, with $57m followed by $33m for future refurbishment capital expenditures.
Brookfield is looking to raise $7bn for Partners II.
According to a document from Orange County, the manager has around $5bn of commitments to the fund.
Brookfield will co-invest $2bn in the vehicle, which will take positions in real estate companies, distressed loans and securities.
The firm will use its operating platforms to make asset acquisitions.
Targeted returns for the fund are a 20% gross IRR and a 2x or greater gross multiple of capital.
The fund is targeting North America, Europe, Brazil and Australia, as well as other markets on a select basis.