Participant Capital Advisors is gearing up to launch a Florida-focused private equity real estate vehicle in the third quarter that will target US build-to-rent multifamily assets.
To support that effort, the Miami-based firm has hired Eli Neusner from Auerbach Funds, a Charlotte, North Carolina-based private equity real estate firm, as managing director and head of US investor relations to oversee fundraising efforts.
Neusner, who has vast experience across asset management, capital raising and investor relations, has raised more than $2 billion in the last decade from family offices, wealth management firms and high-net-worth individuals.
Participant Capital invests in ground-up development, distressed and value-add real estate in the Sun Belt states and other US states and territories where migration is occurring, such as Puerto Rico. The firm targets investments in mixed-use, multifamily, residential, commercial, hospitality and medical office properties.
“Our differentiated real estate platform is especially compelling in the current environment as Florida continues to lead the Sun Belt in migration and occupancy rates, driving ongoing demand for our projects,” Neusner said.
Before stepping over to Participant, Neusner filled a similar position at Auerbach Funds, which targets US value-add and distressed real estate opportunities. He is also the founder of the EastSide Group, an investor relations and strategic marketing firm serving alternative fund managers.
Neusner will work alongside president Bernie Wasserman, who is betting on Neusner’s thorough understanding of high-net-worth individuals’ investment needs to help boost fundraising capabilities.
“Affluent investors appreciate differentiated real estate opportunities, and in today’s volatile market, real estate can be an attractive low volatility alternative,” Wasserman told PERE this week. “While we are in a much different market today than we were this same time last year, the drivers favoring a high growth market development strategy like ours remain intact. We tend to look beyond short-term volatility at the longer-term trends supporting markets and property types.”
One longer-term trend Wasserman cited was the national housing shortage, which is especially acute in Florida.
“Despite rising rates, inflation and political uncertainty, there is stable migration due to the low tax environment and high quality of life that is still affordable to high wage earners moving southward,” he said.
Wasserman disclosed that high profile corporate headquarter moves in recent months – involving the likes of hedge fund Citadel, law firms Kirkland & Ellis and Sidley Austin LLP and accounting firm Anchin – are bringing more high wage earners to the state.
Additionally, rising mortgage costs are expected to drive new residents to Florida’s already crowded rental market, which has some of the lowest vacancy rates in the country. Miami’s vacancy rate was 3.1 percent as of Q2 2022, nearly 40 percent below the national average of 5.1 percent, according to commercial real estate data provider CoStar.
“Clearly, no one expected the double-digit growth in Florida valuations and rents we experienced in recent years to continue unabated,” said Wasserman. “Though the steep rise in home valuations seems to have tempered, with many [would-be] homebuyers shifting their focus to the rental market, we may continue to have above average rental growth in some markets.”