Real Capital Solutions (RCS) is seeking to raise $350m (€303m) for a new fund targeting distressed US office assets, giving the vehicle an overall investment firepower of approximately $850m with leverage.
Marcel Arsenault, founder and CEO of RCS, has committed $50m as an anchor investor in the RCS Contrarian Office Fund, which will target high-net-worth individuals and family offices.
RCS said the fund will target class-A and B offices across primary and secondary US markets whose valuations have fallen due to higher interest rates, refinancing pressures and post-COVID-19 shifts.
Arsenault said: “At RCS, we’ve spent more than four decades investing outside the consensus and finding highly attractive opportunities that other investors overlooked. The RCS Contrarian Office Fund reflects that same philosophy, giving investors access to what we believe is another generational opportunity to acquire institutional-quality office assets at valuations that can create compelling long-term value.
“While the office market continues to reset, we believe the long-term outlook for premier office assets is extremely strong. Companies still need high-quality workplaces to attract talent, foster innovation and drive growth, and those assets will continue to outperform over time.”
Adam Abeln, CIO and managing director at RCS, said: “We believe the current market presents one of the most compelling office investment opportunities in decades, as forced selling, limited financing availability and historically wide bid-ask spreads continue to create attractive entry points for disciplined investors.
“The RCS Contrarian Office Fund gives qualified investors – particularly high-net-worth or family office investors seeking non-correlated alternative investments – access to acquire high-quality office assets at historically attractive valuations. The fund is well positioned to identify, acquire and actively manage assets through the next phase of the office market cycle.”
The launch of the RCS Contrarian Office Fund follows the manager’s recent deployment of capital into deeply discounted US office assets.
In April, RCS invested $16.1m to acquire MetroWest, a 207,714sqft office building in the Chicago suburb of Naperville, at a 50% discount to its previous $32.5m sale price in 2015.
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