Avenida Capital has launched its first institutional fund targeting retail, commercial, residential and industrial properties located in the major cities of Colombia, according to an announcement from the New York-based real estate investment firm.
The $125 million opportunistic vehicle, Avenida Colombia Real Estate Fund I, expects to hold a first close in the fourth quarter and a final close by summer 2012. The firm, which is not using a placement agent to raise the equity, declined to disclose the returns the fund is targeting.
Alexander Chalmers, managing director at Avenida, told PERE that Avenida has been investing in Latin America with its own money since its formation in 2006. Now, the principals at the firm believe the time is right to launch a fund targeting Colombia.
“We've been building our local developer relationships and are now ready to raise our first fund,” said Chalmers. He added that the fund will have a liquidity mechanism for those investors that want to exit the vehicle.
“Colombia offers a compelling risk-return for our investors and their opportunistic allocations,” Chalmers added. “There currently are not a lot of high-quality assets down there, either in the residential or commercial space. That lack of Class A real estate creates a tremendous opportunity to build high-quality assets.”
Avenida is launching its maiden fund in conjunction with Colombia-based commercial bank Grupo Interbolsa, which will provide fund administration and raise capital from its network of high-net-worth investors within the South American nation.
Since its founding, Avenida has pursued direct and entity-level equity investments across select property types throughout Latin America, committing capital to Brazil, Chile, Colombia and Panama, as well as the US. The firm's principals include David Smilow, who has sponsored more than a dozen start-up firms and has acquired roughly $250 million of real estate assets in the US and Latin America; Bruno Lobo, who had worked at the Carlyle Development Group and Brookfield Asset Management prior to joining Avenida; and Michael Teich, who was a vice president at Latin America for Global Market Services prior to founding Avenida.