Carmel Partners has raised $1.35 billion from its U.S. multifamily real estate value creation fund (Fund 9). This marks the final close of the investment pool, which attracted family offices, wealthy net worth managers, pension funds, endowments and foundations. Some of these were based in the U.S., while others were international players.
The move will give Carmel the flexibility to pour capital into developments, operating properties and opportunistic debt. It's unclear what regions the San Francisco-based firm plans to target, but historically it has targeted multifamily investments in major markets where supply is limited, including Boston, Denver, Hawaii, New York, Seattle, Washington D.C, as well as Northern and Southern California.
Already, the fund has purchased nine operating assets, with the locations not named.
"We are grateful for the continued support of existing investors and welcome our new investors," Ron Zeff, founder and CEO of Carmel, said in a statement.
"We value the trust they place in us to invest on their behalf. Fund 9 has a well seeded portfolio with $477 million in committed equity and is deploying into what we believe is the most attractive multifamily opportunity set that the Firm has seen in almost 30 years of investing."
Since initially launching its fund series in 2003, Carmel has raised more than $8.5 billion. Through the company's last one, Carmel Partners Investment Fund 8, it raked in $1.58 billion through the final close, which occurred in April 2023.
Carmel, through its history, has renovated and developed or is in the process of doing so, 50,000 apartment units. In addition, it has completed 22 debt investments across a gross value that exceeds $19.5 billion.
A growing trend in the apartment sector has been nonexistent construction. In fact, a recent RealPage report found that 16 markets, including Texas and California areas, had nothing underway. Meanwhile, a year earlier, only 10 markets had no construction underway and just six lacked activity two years ago. The change comes as some markets like Midland/Odessa in Texas struggle with volatility and others like Youngstown in Ohio enjoy strong fundamentals like high occupancy.
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