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Private Equity Firm Launching Another Multifamily Fund

Electra America Seeking $300M, Remains Bullish on Rentals
February 28, 2018
Electra America, a private equity firm for multifamily properties, is counting on another big year from the rental market with the launch of a new investment fund.

The North Palm Beach, FL-based firm said it closed its 2017 fund with $212 million, and has started a 2018 fund with a goal of $300 million.

Electra partners with Tampa, FL-based American Landmark Apartments, which operates more than 23,000 apartment units across the Southeast.

Joe Lubeck, founder and CEO of both companies, said interest has been strong from foreign institutions and high-net-worth investors.

Some analysts worry that the multifamily market soon may be overbuilt, but Lubeck said continued job growth and population increases are fueling the demand for rentals.

"Too much is focused on the sheer volume of construction without looking at the ratios to job growth and population," he told CoStar News.

What's more, while most developers are specializing in the luxury product, the value-add market preferred by Electra still has plenty of room to flourish, Lubeck said. Electra tries to improve the properties it acquires while keeping rents affordable for middle-class consumers, he notes.

"We are bullish on the multifamily market, subject to many qualifications," Lubeck said. "There are many new players in the market these days, and they tend to bid properties up. We are very cautious about the auction process. We want to pick our spots."

Miami economist Ken Thomas, president of Community Development Fund Advisors, said the high cost of owning will keep many consumers in the rental market for years to come.

"Ownership is becoming more and more a dream," he said.

Lubeck sold a portfolio to Starwood Capital in 2015 for $1.9 billion. He and his partners later started another venture. In 2017 they acquired about $850 million in multifamily assets and expect the total to climb to $1.5 billion this year.

The 2017 fund has more than 7,000 rental units in four states. Here are those properties:

    Florida

  • Landings at Lake Gray, a 300-unit apartment complex in Jacksonville
  • Vue at Baymeadows, a 352-unit apartment complex in Jacksonville
  • Palm Trace, a 160-unit apartment complex in Jacksonville
  • Northgreen at Carrollwood, a 438-unit multifamily community in Tampa
  • Reserve at Lake Irene 384-unit apartment community in Orlando
  • The Avenue, a 522-unit apartment community located in Orlando
  • The Avana, a 264-unit apartment community located in Tampa
  • Lago Paradiso, a 424-unit apartment community in Miami

    Georgia

  • The Parke at Oakley, a 240-unit apartment community in Fairburn
  • Belle Vista, a 312-unit apartment community in Lithonia
  • Marbella Place, a 368-unit apartment community in Stockbridge
  • Parc at 1695, a 252-unit apartment complex in Norcross
  • Parc Shores, a 520-unit apartment community in Duluth
  • Parc at 980, 586-unit apartment community in Lawrenceville

    North Carolina

  • Grand Reserve at Pavilion, a 408-unit apartment community in Charlotte
  • Level at 401, a 300-unit apartment community in Raleigh

    Texas

  • Pecan Springs, a 344-unit apartment community in San Antonio
  • Firewheel, a 366-unit apartment community located in San Antonio.




Paul Owers, South Florida Market Reporter  CoStar Group   
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