Waterton is expected to raise between $1bn and $1.2bn (€1bn to €1.2bn) initially for its latest value-add US apartment fund.

According to San Diego City Employees’ Retirement System’s (SDCERS) meeting document, the Waterton Residential Property Venture XV fund, which seeks to raise $2bn in total, is expected to have its first close in December.

The pension fund disclosed in the meeting document that it is planning to approve a $25m commitment to Venture XV. 

Earlier this year, Waterton raised $1.5bn for Waterton Residential Property Venture XIV, the predecessor fund.

Waterton is expected to make a 1% or $20m co-investment into the latest fund.

The fund targets a net internal rate of return of 12% to 13% with a leverage of up to 65%. 

Venture XV is expected to buy undercapitalised, underperforming assets from stalled developments, foreclosures or owners in need of liquidity.

Waterton declined a request for comment.

To read the latest edition of the latest IPE Real Assets magazine click here.