Despite radical uncertainty surrounding the near-term and long-term human and economic impacts of the coronavirus, U.S. multifamily housing properties in some markets seem to be drawing continued interest from foreign institutional buyers. This week, it was announced that PFA, Denmark’s largest pension fund with approximately $82 billion in assets under management, has acquired a 49% equity stake in a newly formed U.S. multifamily REIT joint venture.
PFA’s partners in the venture are Atlanta-based private investment manager firm Domain Capital Advisors, which manages $6.1 billion across multiple asset classes and investment strategies, and property manager Simpson Housing LLLP, headquartered in Denver.
The portfolio, valued at $1.05 billion, consists of 3,487 multifamily units in Class A properties situated in high-growth U.S. markets, including Austin, Charlotte, Denver, Houston, Nashville, Phoenix, Portland and Seattle. The portfolio includes new and refurbished urban and suburban properties averaging six years in age, with proximity to transportation infrastructure, and more than 95% leased at closing.
“We are excited about our new relationship with PFA Pension and look forward to growing our relationship with them through further acquisitions,” Patrick R. Leardo, executive managing director and chief executive officer of Domain Capital Group, said in a statement publicizing the deal.
A first from South Korea
Also this week, news of a new Chicago-based multifamily residential joint venture was reported between Strategic Properties of North America (SPNA) and South Korea’s largest investment banking and brokerage firm Mirae Asset Daewoo.
Commercial Observer reported that the firms together received $102.5 million in five-year, fixed rate debt from Newmark Knight Frank’s agency lending platform to purchase the Cityfront Place luxury apartment tower, located in Chicago’s Streeterville neighborhood.
Finalized on April 1, the deal reportedly marks the first investment of a South Korean investment firm in the U.S. multifamily residential property market.