Deals

Greystar amasses $800m for US value-add multi housing

The company says it is targeting value-add opportunities in markets including those with a 'high exposure to domestic energy employment' such as Houston and Dallas.

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Greystar, the largest operator of apartment buildings in the US, has raised $800 million for a value-add multi-family fund.

The Charleston-based company said it had held a final close of Greystar Equity Partners VIII, which is $200 million more than its 2011 value-add predecessor, GEP VII – now fully invested.

In a statement, Greystar added the discretionary commingled fund had a “diverse group” of investors ranging from domestic to international pension plans and private wealth managers.

The firm's strategy for the latest fund is to build a nationally diversified portfolio of 'high quality' multifamily assets in markets that are “poised for out-performance” and it has an allocation of around $150 million towards a seed portfolio of 10 properties including an asset in Los Angeles and a collection of value-add opportunities in markets that had a “high exposure to domestic energy employment” including Houston and Dallas.

Wes Fuller, executive managing director and head of Greystar’s $7.5 billion investment management business, said that while the multifamily landscape had evolved over the last couple years, the company continued to have “a positive outlook on the industry driven by strong secular demand trends and headwinds against widespread over-development”.

Bob Faith, chairman and chief executive officer of Greystar, added: “The recent expansion of our operating platform gives us even greater depth throughout the major markets in the US.”

The company, founded in 1983, is the largest operator of apartments in the US given it has as many as 385,000 units in over 100 markets. Not only does it have an existing portfolio, it also has $1.5 billion of development under way.

It has been expanding geographically too, by going into Mexico and the UK in the recent past. Last October, it teamed up with Goldman Sachs' real estate group to buy a portfolio of 21 UK assets from the remnants of a collapsed investor called Opal Property Group, giving it student accommodation in major cities such as London, Manchester, Leeds and Liverpool. It then added to its UK assets in May this year when it bought a further portfolio of student digs.