Carroll, a national real estate firm that has invested more than $1 billion in apartments this year, has bolstered its buying power further in an extended bet on rental demand.
The Atlanta-based company has raised more than $340 million in capital from two institutional investors for its Carroll Multifamily Venture VII. The commitments complete fundraising for the investment fund. Fund VII is targeting multifamily assets in line with both Carroll’s value-add buy-and-improve strategy as well as its core buying strategy across the Sun Belt region and into new markets in the West.
Heading into the second half of the year, Carroll plans to continue following migration trends that are still intact as people flee high-cost-of-living states such as New York and California, the firm said.
Higher borrowing rates and inflation, in combination with continued supply chain and labor shortages, will likely limit new housing construction for the next year, thus driving strong rental demand, the firm said. The fund teams as a partner in acquisitions so the capital raise gives the firm up to $5.5 billion in total buying power, Carroll said.
“The launch of our latest fund vehicle demonstrates the growth of Carroll’s footprint in capital markets and the strong investor appetite in the multifamily sector,” Patrick Carroll, founder and CEO of Carroll, said in a statement.
To date, Fund VII has invested in 14 properties in five states — Georgia, Florida, North Carolina, Texas and Arizona — valued at $1.3 billion. Three of the 14 deals were acquired at 100% ownership, a new investment strategy for the firm.
One of its latest and largest acquisitions this year was the 408-unit Arium Lauderdale in North Lauderdale, Florida, which it acquired for $106 million in May.
Among deals where it came in as a partner in the second quarter were acquisitions of properties in Phoenix, which is a new market for the firm and one that adds to its plan to grow holdings in the Western United States. Previous westward expansions included two Las Vegas acquisitions in 2021.
The fundraising comes on the heels of first-half 2022 activity that included $2.6 billion in total buying and selling volume.
Carroll’s seventh investment fund closed at more than double the size of the firm’s prior fund, Carroll Multifamily Venture VI, which closed in 2019 at $125 million.