Final Closing of “Avanath Affordable Housing IV” Totaling $760 Million
JANUARY 2021
Accord Europe Limited served as lead international capital advisor in connection with the offering of Avanath Affordable Housing IV.
Below is the press release issued by Avanath Capital Management, LLC, the fund’s sponsor:
Avanath Capital Management, LLC, a private real estate investment manager and Registered Investment Adviser, has announced the final close of its fourth discretionary fund with a total of $760 million in equity commitments, which is significantly above the fund’s original commitment target of $550 million.
According to Daryl Carter, Avanath’s Founder, Chairman and CEO, this is an investment vehicle that is dedicated to affordable and workforce housing in the U.S., with an emphasis on underserved markets, including communities of color.
“Our focus has always been on preserving affordability in underserved markets across the country,” explains Carter. “As our fourth fund, we plan to continue this mission by bringing institutional capital to these communities, many of which are communities of color. In fact, our entire Avanath team is extremely diverse, which we believe allows us to better serve residents and our investors.”
The fund will target affordable/workforce housing assets in supply-constrained markets with high barriers to entry that are poised for strong job, income, and economic growth.
The investors in the fund consists of a variety of prestigious institutional investors including US pension funds, foundations, corporations, banks, family offices, UK foundations and family offices and European pension funds. Affiliates of the Accord Group based in San Francisco and London and Selinus Capital of Frankfurt, provided placement services regarding the identification and closing of the European and U.K. investors within the Fund. In fact, more than 50% of the capital in the fund is from European and UK investors and more than 40% of the fund was raised throughout the pandemic, according to John R. Williams, President and CIO at Avanath.
“The need for quality affordable housing and the affordability crisis in the U.S. in not going away,” says Williams. “It is actually being exacerbated in the current environment. As institutional investors continue to recognize this ongoing demand and the stability of affordable housing even in times of uncertainty, we will continue to see strong capital flows to the sector. Foreign investors also continue to find U.S. affordable housing particularly attractive given its ability to act as a stable and durable portion of their portfolio because of its increasing demand and limited supply across the U.S. Our European and UK, as well as our US investors, are also extremely attracted to Avanath’s strong commitment to ESG and Social Impact programs and goals.”
Additionally, because more than 40% of the fund was raised during the pandemic, many of these investor commitments were closed virtually as a result of travel limitations and COVID-19 protocols, adds Williams.
“This again speaks to our strength as an operator, our strong investment in technology and to our durable investment model,” says Williams. “Our track record within the affordable housing sector and the way we navigated throughout the pandemic left investors confident enough to continue to make allocations even in a virtual environment.”
To date, Avanath has acquired or has under control 16 assets (3,234 units) within the fund totaling $387 million in investment equity.
“These assets are closely aligned with our investment thesis and we plan to continue to deploy capital into many high-cost markets across the U.S. over the course of the year,” says Williams.
Avanath Capital Management currently has more than $2.5 billion in AUM totaling 88 apartment communities and more than 11,000 units. Avanath was represented by the New York office of Debevoise & Plimpton, along with the Frankfurt and Luxembourg offices of Clifford Chance.
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 also a Registered Investment Adviser and provides property management services through Avanath Realty, Inc.
Founded by Daryl J. Carter, the Avanath management team averages 25 years of experience and has successfully guided investment funds in defining growth opportunities and delivering past returns that have performed on par with or surpassed returns in comparison to relative benchmark(s). 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 EUROPE LIMITED
Accord Group Holdings LLC (“Accord”), through its affiliates, is a global capital advisor and principal investor. With its headquarters in San Francisco and personnel in Chicago, London and Seoul, Accord engages with a wide variety of participants in the real estate private equity industry. Accord Europe Limited, its broker/dealer affiliate, provides advisory and capital raising services in the United Kingdom and Europe. For further information on Accord, visit: www.accord-group.net.
For Avanath press enquiries, please contact:
Micaela Fehrenbach /Lexi Astfalk
Brower Group
949-438-6262
mfehrenbach@brower-group.com
For Accord company enquiries, please contact:
Paul Jackson, Accord
+44 203 598 9704
pjackson@accord-group.net
