Centennial Holding has held the first close on its fourth value added real estate vehicle, hauling $132 million for Centennial Real Estate Fund (CREF) IV, according to a source familiar with the matter. The Atlanta-based private real estate investment firm is seeking between $200 million and $300 million in equity for the fund, which launched in January.
CREF IV’s first close is comprised of commitments from existing investors in the firm’s previous vehicles, nearly 100 percent of which have re-upped with the firm. While those investors consist of family offices and high net worth individuals, the firm expects that the balance of the capital in CREF IV will come from new institutional investors who are also showing interest.
Through CREF IV, Centennial will employ the same investment strategy as it did with its previous funds, targeting low-risk, Class A multifamily assets – typically contemporary, upscale garden and mid-rise apartment communities – with an average of 250 to 300 units. Geographically, Centennial will target high-growth areas of the Southeast and Mid-Atlantic, as well as stretches of central Texas.
The firm is already in the process of closing on its first investment for CREF IV, which is located in Texas. Centennial targets investments from $10 million to $50 million and is seeking net IRRs in the mid-teens on behalf of CREF IV.
Centennial is targeting a final close for the vehicle by the first quarter of 2015. The firm’s previous fundraising effort, CREF III, closed on $107 million in commitments in October 2012.