REAL ESTATE – Penwood Real Estate Investment Management is looking to start raising money for its next commingled fund.
Principal John Hurley said, "We are now at the point in investing in California Select Industrial Partners…We have now invested or committed 60% of the capital for our current fund. To keep the deal flow coming, we need to think about the next fund. There is a good chance that the fund could be started sometime this year."
The new fund will have a similar strategy but be focused on a different market. It will be a value-added investment plan with industrial properties but the market has not yet been determined. "We have not made a final decision as to which market we will be focusing on for the next fund," Hurley said.
A combination of deals will be examined for the next fund and some transactions will involve the purchase of assets in need of renovation. The firm will also pursue investing equity in new development projects.
Penwood Real Estate continues to invest the capital for the California Select fund. One of its most recent transactions was the purchase of an existing 8,000 square metres of industrial property in Santa Fe Springs, California. The purchase price was $12.4m (€9.42m). The real estate manager completed the deal with the assistance of its local operating partner, Western Realco.
Penwood Real Estate has several options where value could be added to the property. One is to wait three years until the tenant in the single-tenant facility has its lease up for renewal. The total of some 2.4 hectares of land in the deal could also support the development of an additional 8,800 square metres, and the firm has heard from parties that would be interested in buying the entire property for their own use.
The California Select Industrial Fund has a total of $100m of equity. This includes a $50m investment from the New York State Teachers Retirement System. It invests in industrial properties in southern California.
