Monday 25, September 2017 by Georgina Enzer

Investcorp grows residential real estate portfolio with $350 million investment in US

Investcorp, a leading provider and manager of alternative investment products, today announced that its US-based real estate arm has invested in six multifamily properties in Florida and Arizona, for a total purchase price of approximately $350 million.

The properties are located in key growth markets with strong fundamentals in the multifamily space.

Mohammed Al-Shroogi, Co-CEO at Investcorp, said: “Our commitment to US residential real estate continues to serve our clients well. Underscoring our confidence in the US real estate market and economy, over the past 18 months, we have invested in real estate transactions valued at more than $1.8 billion. As we continue to focus on the firm’s growth, real estate investing will play an important role.”

Highpoint Club and Montevista at Windermere are two apartment communities, which combined have 708 units. These properties are located within two different submarkets of the Orlando, Florida metropolitan area, a market that is expected to see population, employment, and GMP growth rates among the top five in the US over the next five years. According to the US Department of Labor, the Orlando metropolitan area was one of three metropolitan areas to experience the highest year-over-year percentage increase in employment in the country, at 3.2 per cent as of August 2017. The Orlando multifamily market has benefited from a low vacancy rate and solid rental rate growth over the past several years, and these trends are expected to continue.

Fahad Murad, Managing Director at Investcorp for Bahrain, said: “The acquired properties represent a great addition to our growing portfolio of multifamily properties in the US. The strong occupancy levels in these properties, together with the strong fundamentals of the markets they are located in, made them an attractive investment for us.”

Aqua Deerwood is a 616-unit, garden-style, apartment complex located within the dense, high-income Southside/Bay Meadows submarket of Jacksonville, Florida. This location has seen strong growth due to its proximity to employment hubs as well as entertainment and higher education. The apartment complex is across the street from Deerwood Office Park, which houses a large concentration of companies, including Florida Blue, Merrill Lynch, United Healthcare, and Fidelity Bank. Also boosting the area’s population growth are underlying fundamentals such as no state income tax, a low cost of living, and favourable climate. Jacksonville is the fourth largest metropolitan area in the state and the tenth for population growth in the entire country.

Arcadia Cove, Tuscany Palms and Midtown on Main are three, for-rent multifamily properties located in infill locations in the Phoenix metropolitan area. Combined, these properties have 1,486 units. Phoenix remains a high growth market, with growth fueled by an affordable cost of living, high-quality transportation infrastructure, and a business friendly environment. Over the past few years, the Phoenix-Mesa-Scottsdale metropolitan area has ranked third in the US for employment growth and number one in population growth. In the past year, financial employment has expanded with the addition of 10,400 jobs, while the professional and business services sector added 9,400 jobs. The region is projected to experience some of the highest rental rate growth in the country over the next five years, particularly as population, employment and household growth outpace new units of supply.

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