$300M Multifamily Fund Reaches 1st Close

Atlantic | Pacific Real Estate Group and Blue Arch Advisors have scored $140 million of equity commitments for the vehicle.

The Flats at 55Twelve. Image courtesy of Atlantic | Pacific Cos.

Atlantic | Pacific Real Estate Group (A|P) and Blue Arch Advisors have closed on their co-sponsored fund, Blue Atlantic Partners III, with $140 million of equity capital commitments. The fund, which focuses on buying existing multifamily communities in the Southern U.S., expects further closings in the following months with a total target raise of up to $300 million. Leveraged buying power is expected to exceed $750 million.

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The fund has also notched its first acquisition, The Flats @ 55Twelve, a 268-unit community in Durham, N.C. The deal builds on a track record of roughly $1 billion in acquisitions by previous Blue Atlantic Partners vehicles. A|P and Blue Arch Advisors closed on the first fund in the series in 2016, followed by the second vehicle the following year. 

Blue Atlantic Partners III will target affluent suburbs of major cities in the Southeast and Southwest, with a strategy of purchasing multifamily properties that can benefit from A|P’s property management and value-add efforts. Backers of the fund include domestic and international institutions and high-net-worth individuals, according to a statement.

Investing in Durham

The fund’s maiden acquisition is also A|P’s first purchase in the city of Durham. The Flats @ 55Twelve is located at 5512 Sunlight Drive, near the intersection of Interstate 40 and Highway 15-501, with quick access to Research Triangle Park and downtown Durham. Oak Residential Partners purchased the asset from Richmark Development in 2014 for $33.1 million, according to Yardi Matrix.

Built in 2001, the 12-building, three-story property features a mix of one-, two- and three-bedroom units with an average size of 1,003 square feet. Community amenities include a resort-style pool, clubhouse, fitness center and Zen garden. A|P plans to make significant capital improvements to the property, including interior unit upgrades and common area enhancements.

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