Archstone closes US multifamily club fund

The Denver-based apartment REIT already has made four acquisitions on behalf of its $350 million Archstone Multifamily Partners.

Archstone has closed on a club fund targeting multifamily properties in core US markets in which the REIT has a significant operating presence. According to a statement, the Denver-based apartment giant already has acquired four apartment communities in coastal neighbourhoods on behalf of the $350 million fund.

As PERE previously reported, Archstone Multifamily Partners, which had an initial target of $500 million, received commitments from Allianz Real Estate and the Canada Pension Plan Investment Board. Archstone also committed its own equity to the fund. M3 Capital Partners served as placement agent. 

A spokesman for the firm confirmed that Archstone Multifamily Partners initially was launched at the end of July. He declined to comment on PERE’s previous article. 

The re-named multifamily communities that Archstone already has purchased on behalf of the fund are the Archstone Kips Bay in New York; Archstone Boca Town Center in Boca Raton, Florida; Archstone Kirkland at Carillon Point in Kirkland, Washington; and Archstone Sunnyvale in Sunnyvale, California. The REIT is sourcing and managing the fund's investments, and Archstone's chief executive R. Scot Sellers said in a statement that it expects “to make several additional acquisitions in premier locations in the country” on behalf of the vehicle. 

In addition to Archstone Multifamily Partners, Archstone has approximately $3.4 billion of total investments in non-fund partnerships and joint ventures and approximately $1.7 billion of total investments in The Archstone German Fund. As of 31 March, Archstone owned or had an ownership stake in more than 73,000 units in the US and Europe, including units under construction.

Meanwhile, Archstone is at the centre of a heated custody battle between Lehman Brothers Holdings, which currently owns 73.5 percent of the REIT, and minority owners Bank of America and Barclays Capital. Hopeful minority owner Equity Residential has been looking to acquire a 26.5 percent stake in Archstone since late last year.