Hungerford Properties has held an interim closing on its second value-added fund, the Vancouver-based real estate investment firm said Wednesday.
The firm launched the HPWC Fund II in the first quarter of 2016 and has garnered C$170 million ($127 million; €118 million) in commitments largely from existing institutional and family office investors, the firm said in an announcement. With C$50 million soft-circled, the firm expects to hold a final close in the coming months. The firm’s target size for the vehicle is C$200 million ($149 million; €140.5 million), with a hard-cap of C$225 million.
Hungerford closed HPWC Fund I in August 2013 on C$120 million, PERE previously reported. The firm is following the same strategy with both funds, seeking value-added properties in major cities in western Canada, Andrew Hungerford, a partner at the firm, told PERE.
Like the last fund, Hungerford plans to invest the latest vehicle’s capital in a diversified portfolio of moderately leveraged commercial and residential properties, focusing on refurbishment and redevelopment opportunities in gentrifying neighborhoods and those undergoing transportation infrastructure upgrades. For both funds, the firm is aiming for a gross internal rate of return of approximately 20 percent.
To date, the firm has allocated 25 percent of the fund’s capital to deals, but has not yet made any transactions public, Hungerford said. The firm manages about C$400 million in assets.
New York-based Allegro Advisors was the placement agent for HPWC Fund II, according to Wednesday’s statement.