Waterton has completed the final close for its Waterton Residential Property Venture XV with total commitments of $1.73bn (€1.6bn), according to information provided by the real estate fund manager.
The fund raised 15% more than its predeccessor, which raised $1.5bn in 2021.
Just under half of the limited partners in the latest fund were new investors to the fund series. One of the more significant new investors is the New York State Common Retirement Fund, which committed $300m to the latest fund, according to public information provided by the pension fund.
Michelle Wells, managing partner of investor relations at Waterton, said, “Our fundraising success in the midst of a generally challenging fundraising environment, speaks to our long-term performance as a multifamily specialist and the strong investor relationships we’ve built over the years.”
Waterton sees strong investment opportunities in the current marketplace. David Schwartz, chairman and CEO of Waterton, said: “We expect to see significant opportunities in the multifamily sector as a result of the current, interest-rate driven disruption and the near-term oversupply in certain markets with healthy longer-term fundamentals.”
The fund manager has already invested around 20% of the capital for the fund. This has included some purchases of existing assets in the markets of Chicago, White Plains New York, and Seattle.
The fund has also made more than $100m in credit focused investments, including mezzanine and securitised debt. Some of the debt transactions have been secured with assets in New Jersey, Jacksonville and Chicago. The overall allocation for debt investing in the new fund is 10%.
A new component is Waterton is that Fund XV has a debt sidecar co-investment option available to limited partners. The option was not available to investors in the previous Waterton funds.
A potential investor in this is the San Diego City Employees Retirement System, which could commit $15m, according to the pension fund.
Waterton is expecting that the total capitalisation for Venture XV will be between $4.3bn and $5bn through a loan-to-cost on the portfolio in the range of 60% to 65%.
