Cortland Wraps Value-Add Fund at $1.5B

Cortland has closed its sixth value-add multifamily fund targeting properties in the Sun Belt and Mountain West states with $1.5 billion in commitments. The fundraise exceeds the fund’s $1 billion target, with 80 percent of commitments coming from institutional investors.

Atlanta-based Cortland, a multifamily investment, development and management company, noted there was upsized demand for its Cortland Enhanced Value Fund VI, LP, or CEVF, from legacy fund investors, as well as significant commitments from new investors. About one-quarter of the commitments were from foreign investors.

Cortland noted that the fund, similar to others in the CEVF series, will be aiming to capitalize on the company’s market scale and concentration in target growth markets in the U.S. Cortland closed its fifth multifamily valued-add fund, Cortland Enhanced Value Fund V, LP, in May 2021 after it hit its fundraising limit of $650 million. Fund V also included legacy investors as well as new and existing institutional investors.

Fund VI has been nearly 30 percent committed. Details on assets acquired through that fund have not been disclosed.

Cortland did not deploy available value-add capital from mid-2022 to late 2023, while interest rates were rising. However, the firm said in a statement that it is now capitalizing on discounted asset prices and higher yields in what it termed an improving operating and capital markets environment.

The company manages and is directly or indirectly invested in upwards of 250 apartment communities comprised of more than 80,000 units across the U.S. The firm has regional offices in Dallas, Denver, Houston, Phoenix, Charlotte, N.C., and Orlando, Fla.

Cortland’s recent activity

Cortland has been active as both a seller and buyer in several U.S. markets. In July, Cortland acquired Villas River Oaks, a 288-unit property in Houston from Heitman, expanding its multifamily holdings in the metro to 17 assets with more than 5,000 units. The company now owns 68 multifamily properties in Texas with nearly 28,000 units. Cortland, which is planning interior and exterior renovations at the Class A community, has rebranded the 28-year-old property as Cortland River Oaks. Located at 777 Dunlavy St., the 5-acre property is about 3 miles from downtown Houston and 20 miles from George Bush Intercontinental Airport.

Last August, Cortland sold the 416-unit The View at TPC in San Antonio for $70.8 million to an affiliate with Quarry Capital. The 13-building property came online in 2014. In October, the firm sold Arise Craig Ranch, a 270-unit property in McKinney, Texas, to CONAM, which purchased the asset through its CONAM Multifamily Partners Fund III.