Continental Realty Corporation (CRC), in partnership with global investment firm Brown Advisory, has closed on the Core Multifamily Fund, LP, in which approximately $146 million in private equity funds were raised.
The Baltimore-based partnership for the fund will target Class A, well-constructed properties built within the past four years, with a focus on stabilized or near-stabilized opportunities throughout Southeast suburban and urban submarkets.
“The Core Multifamily Fund provides our team ongoing capacity to acquire newly constructed Class A assets in these regions of the country where we have been investing since 1996,” JM Schapiro, CEO of CRC, told Commercial Observer. “Given our deep understanding of the markets and current market conditions, especially the job and population growth, our vertically integrated team believes this is the optimal time to invest in a core multifamily strategy for long-term holds.”
The company will look to acquire newly developed top-quality suburban and urban communities in locations with strong demographics and limited new supply, Schapiro added.
CRC will remain an active buyer of value-add investments throughout the mid-Atlantic, including The Crossing at White Marsh, Padonia Village and Courthouse Square, all in the Baltimore area.
Since 2017, CRC has acquired 13 multifamily properties totaling more than 3,200 units with a total capitalization of approximately $750 million throughout the mid-Atlantic and Southeast portions of the U.S. Those include Edison Lofts and St. Mary’s Square in Raleigh, N.C.; The Flats at Ballantyne and Park & Kingston in Charlotte, N.C.; and Central Island Square in Charleston, S.C.
Of those recent deals, 70 percent were sourced off-market based on the company’s deep relationships with key market participants throughout the regions, and it’s expected those relationships will continue to allow CRC to source off-market opportunities on behalf of the new fund, Schapiro said.
Overall, CRC owns and manages a diversified portfolio of more than 9,000 apartment homes, as well as retail centers and other commercial properties consisting of more than 6 million square feet of commercial space across 10 states, with a portfolio value exceeding $3.2 billion.
“We believe multifamily properties benefit from attractive long-term supply/demand dynamics, and current multifamily fundamentals are strong,” Ari Abramson, vice president of acquisitions for CRC, told CO. “Historically, real estate has outperformed public equities and fixed income during periods of rising inflation. Furthermore, multifamily investment provides for a hedge against inflation as multifamily leases renew each year, allowing for annual resets of rental rates.”
Keith Loria can be reached at Kloria@commercialobserver.com.