Brookfield Asset Management, the Toronto-based alternative asset manager with over $150 billion in assets under management, and its multifamily subsidiary, Fairfield Residential Co., said they jointly raised $323 million in total commitments for its U.S. multifamily value add fund, far eclipsing their $250 million target.
Brookfield put up $50 million of its own money and also received strong support from several undisclosed global institutional investors. Fairfield manages the fund, which seeks to invest in value-add opportunities by acquiring undervalued or underperforming multifamily apartment properties in infill or supply-constrained locations that are good candidates for renovation, reposition and operational turnaround.
Launched in 2011, the fund is currently 50% invested. Fairfield became Brookfield's platform for U.S. multifamily investments in 2010 when Brookfield acquired a controlling interest in the San Diego-based firm.
"We are proud of our tremendous success in raising capital in this tight fundraising environment," said Fairfield COO Greg Pinkalla, crediting Fairfield's multifamily platform and expertise with Brookfield's investment and asset management discipline.
David Arthur, managing partner at Brookfield Asset Management, said the fund will take advantage of investment opportunities offered in the current environment resulting from "a limited new supply of apartment properties and strong potential growth in rental demand in major markets across the United States."
Earlier this year, Brookfield announced plans to spin-off a portion of its extensive commercial property operations to shareholders by forming a new entity to be called Brookfield Property Partners that would serve as Brookfield’s flagship public commercial property entity and a leading global owner, operator and investor in real estate. The new entity was expected to include Fairfield Residential as well as its stake in mall owner General Growth Properties, Canary Wharf Properties, and Brookfield Office Properties Inc., which is one of the largest office-building companies in North America.
Following the spinoff, Brookfield's common shareholders were expected to hold approximately a 10% interest in the underlying BPY business and Brookfield would hold approximately a 90% interest, the firm announced in April.