Avanath Capital Management has raised $760m (€615m) for its fourth US affordable and workforce housing fund.
The private real estate investment manager said the amount raised at final close for its fourth discretionary fund exceeded the fund’s original $550m fundraising target.
The manager said the fund was backed by a number of institutional investors including US pension funds, foundations, corporations, banks, family offices, UK foundations and family offices and European pension funds.
John R Williams, president and CIO at Avanath, said more than 50% of the capital in the fund is from European and UK investors and more than 40% of the fund was raised throughout the pandemic.
He added: “The need for quality affordable housing and the affordability crisis in the US is not going away. It is actually being exacerbated in the current environment. As institutional investors continue to recognise this ongoing demand and the stability of affordable housing even in times of uncertainty, we will continue to see strong capital flows to the sector.
”Foreign investors also continue to find US affordable housing particularly attractive given its ability to act as a stable and durable portion of their portfolio because of its increasing demand and limited supply across the US.”
Daryl Carter, Avanath’s founder, chairman and CEO, said: “Our focus has always been on preserving affordability in underserved markets across the country. As our fourth fund, we plan to continue this mission by bringing institutional capital to these communities, many of which are communities of colour.”
Avanath said the fund will target affordable/workforce housing assets in supply-constrained markets with high barriers to entry that are poised for strong job, income, and economic growth.
The fund has so far acquired or has under control 16 assets (3,234 units) within the fund totalling $387m in investment equity, the manager said.
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