Avanath Announces Close of Over $205 Million in Additional Equity Commitments for Open-Ended Fund
JANUARY 2023
IRVINE, Calif. (January 26, 2023) – Avanath Capital Management LLC, a multifamily owner and operator that primarily focuses on affordable housing, announces that it has recently closed on more than $205 million in additional equity commitments to the Avanath Affordable Housing Renaissance Fund (the “Fund”) since November, according to Chairman and CEO Daryl Carter.
“Avanath remains committed to advancing its mission of delivering quality affordable and workforce housing, and this perpetual-life vehicle has positioned us to continually and effectively invest in both our communities and residents,” explains Carter. “As we navigate a period of economic uncertainty, rent-regulated housing is increasingly essential to the ability of residents to live comfortably and thrive in markets throughout the country.”
Carter adds that, according to an April 2022 report from National Low Income Housing Coalition, there are only 36 rental homes available for every 100 extremely low-income renter households: “As our sole investment vehicle dedicated to affordable and workforce housing, the Renaissance Fund and its investors are contributing to necessary and meaningful change. We’re pleased to be managing one of the largest open-ended funds focused on rent-restricted multifamily available today, as reported by Preqin.”
Avanath announced the initial closing of the open-ended Fund this past March, which included $536 million in equity commitments that were used to seed the vehicle with an institutional-quality affordable housing portfolio. Under a year later, the Fund has successfully bolstered the firm’s acquisitions capabilities and allowed for accelerated growth, according to John R. Williams, President and CIO at Avanath.
“Since the initial closing, Avanath has purchased four additional communities with equity from the Renaissance Fund,” explains Williams. “While much of the industry paused or slowed activity in the second half of 2022, our team has been well positioned, through strong capitalization and long-held, trusted industry relationships, to continue to acquire in the high-cost, high-growth markets we target.”
The recent $205 million in equity commitments to the fund, closed in November through early January, speak to the strength and resilience of the portfolio, notes Avanath CFO and Partner Wesley Wilson. The Fund’s portfolio currently includes 27 properties totaling 4,786 units and is valued at nearly $1.2 billion with more than $750 million of equity commitments from more than 15 institutional investors.
“Recent commitments to the fund have come from institutional investors both existing and new to working with us,” says Wilson. “Our investors in this Fund are all aligned with our greater mission and attracted to the portfolio’s stability. Properties within the Fund typically experience occupancy rates above 95%, and our portfolio has traditionally seen residents stay an average of 6 or more years, compared to 1 year at market-rate communities. Further, several of our communities have waitlists that extend years.”
Williams adds that the continued attraction of investors to the Fund and the portfolio’s success are also testaments to Avanath’s holistic investment strategy: “Our firm approaches all of our investments through an ESG lens, with a particular emphasis on operating our communities efficiently to reduce negative environmental impact, as well as tailored, intentional social programming to enhance residents’ lives each day.”
Wilson confirms: “We are proud to be entrusted with these equity investments and are grateful for our continued relationship with Accord Capital Partners, the exclusive capital advisor for the Fund, which, combined with the tireless effort of our entire Avanath team, makes the success of the portfolio and advancement of our mission possible.”
About Avanath Capital Management
Avanath Capital Management is a privately held, vertically integrated investment firm managing real estate and real estate-related investments generating risk-adjusted returns through current income and capital appreciation from its investments. The firm is a Registered Investment Adviser and provides property management services through Avanath Communities, Inc.
Founded by Daryl J. Carter, the firm is led by a management team that averages 25 years of experience and that has successfully guided investment funds in defining growth opportunities. Avanath professionals have real estate operating expertise and long-standing relationships with strong local, regional and national sponsors that can access investment opportunities aligned with Avanath's initiatives. More information is available at www.avanath.com.
About Accord Group
Founded in 2013, Accord Group Holdings LLC (“Accord”) is a global strategic investment and capital advisory firm. With personnel in San Francisco, Chicago, London, Munich, Hong Kong and Seoul, Accord seeks to catalyze GP business plans using a creative, “one-stop shopping” approach that harnesses both strategic capital and global capital advisory expertise to unlock complexity and build long-term enterprise value for sponsors. Accord Group has completed more than $13.0 billion in transaction activity, with a majority representing cross-border transactions.
