REAL ESTATE - Los Angeles Fire & Police Pension System is looking into making a commitment to a new commingled fund, Stratford Land Fund III.
But the pension fund will not be making a final decision until its gets a report on the commingled fund from its real estate consultant, The Townsend Group.
The Stratford Company is the real estate manager of Land Fund III. This commingled fund will be the first time the company has attempted to raise a dedicated institutional fund.
A total equity raise of $300m (€225.5m) is being targeted, particularly from pensions funds. The placement agent for the fund is HFF Securities, with senior managing director Tom Mizo working on the assignment.
Stratford will be making a co-investment of 10% of the total equity, which is to be in place by the end of 2007.
The investment strategy for Land Fund III is to acquire land before its been entitled. The parcels need to be in the path of future development where the prospects look strong for future growth, as when more jobs are being created.
The parcels acquired will be taken through the entitlement process by Stratford. This would include securing zoning, land use permits, overlay districts and public road fundings. The ultimate goal is to sell the parcels that have been acquired to developers, a process that can take from three to five years.
The land will support the development of a variety of projects,such as retail, apartments and office buildings. The markets that it will be looking at are Raleigh and Durham in North Carolina, Atlanta, and major markets in Texas and Arizona.
There will be a limit of 25% leverage on the commingled fund. Some of the deals for the fund will be outright purchases, while others will be accomplished through joint ventures or partnerships.