June 22, 2022
Discretionary Commingled Fund Targets Value-Add and Opportunistic Assets Along the East Coast
McLean, VA—June 22, 2022 –American Real Estate Partners (“AREP”), an institutional fund manager and operating partner, today announced the closing of its third real estate GP fund earlier this month, AREP Strategic Opportunity Fund III (“Fund III”) with $63 million in equity commitments.
Consistent with its predecessors, Fund III's commitments will primarily be used as co-investment capital for the institutional joint ventures Fund III will sponsor and AREP has successfully formed over the past 20 years. Fund III will continue AREP’s focus on a value-add and opportunistic strategy, concentrating on data center, residential, industrial and office assets in East Coast urban and urbanized suburban markets. Fund III’s co-investment capital is targeted to invest in $1.5 B to $2.0 B of total asset value utilizing moderate financial leverage. AREP pre-specified ~30 % of Fund III with three Data Centers being developed inside a $1 billion JV with Harrison Street Real Estate Capital and a residential land development project with Westbrook Partners.
Historically, AREP raised its GP fund capital from a diverse mix of public and private institutional investors and family offices. Fund III continues with that mix of investors and broadens AREP’s investor base by including a significant number of high-net-worth individuals.
“As we announce the closing of our third fund, we would like to thank our partners and their advisors for their support,” said Brian Katz, Co-Founder & President of AREP. “The successful closing of Fund III is an endorsement of our multi-asset investment approach and differentiated strategy and a testament to the strength of our team. We’re extremely optimistic about Fund III and its specified assets and look forward to putting the balance of Fund III's capital to work thoughtfully and prudently.”
“We are grateful for the support of our investors, who trust in our stewardship of their capital with our ability to invest in these historic times to produce risk-adjusted opportunity level returns,” added Doug Fleit, Co-Founder & CEO of AREP. “With our extensive track record and experience in the markets and industry segments in which we invest, we are very well positioned to continue to capitalize on opportunities that meet our objectives through an ever-evolving investment climate."
ABOUT AMERICAN REAL ESTATE PARTNERS
Headquartered in the Greater Washington metropolitan area, AREP is an institutional fund manager and operating partner focused on data center, residential, industrial, and office assets, on both a development and repositioning basis in various markets along the East Coast.
Since the company’s founding in 2003, AREP has deployed over $5.1B across targeted geographies, acquired more than 20 million SF of Class A real estate, and currently oversees over 10 million SF. AREP's vertically integrated real estate platform and experienced Management Team provides exceptional expertise in all ownership disciplines from acquisition to realization. By leveraging this expertise, AREP remains at the forefront of real estate innovation, maximizing investment and enhancing performance to provide added value for its investors. For more, please visit AREP's Newsroom or follow us on LinkedIn.
REQ for AREP
American Real Estate Partners