Pacific Oak Closes Opportunity Zone Fund With $118M

Launched in 2019, the vehicle has already invested in three developments in Arizona and Oregon.

The Byway. Image courtesy of Pacific Oak Capital Advisors

Pacific Oak Capital Advisors, a sponsor, and Pacific Oak Capital Markets, manager and distributor of real estate-focused alternative investment programs, have closed Pacific Oak Opportunity Zone Fund I LLC, with approximately $118 million in total assets, a 21 percent appreciation over the three multifamily properties developed through the fund. Located in the Phoenix and Portland, Ore., markets, the properties are in different stages of completion and lease-up.

The fund was launched in 2019 to invest in, develop, redevelop and manage a diversified portfolio of institutional quality commercial real estate assets with an emphasis on multifamily properties in Qualified Opportunity Zones in the United States. Fund managers are seeking additional investments to further diversify the portfolio, focusing on attractive opportunity zone investments that will build on the fund’s performance while maintaining discipline on deal selection.

“We are actively looking at other markets, such as Los Angles, Nashville, Reno and Denver and we will continue to look across the U.S.,” Peter McMillan, co-founder of Pacific Oak Capital Advisors, told Multi-Housing News.

McMillan said the team is broadly optimistic about the market fundamentals for multifamily and is committed to a fourth development with the same developer from The Byway, a 173-unit, garden-style, suburban multifamily property in Gresham, Ore., which is about 20 minutes from Portland. Previously known as Wood Village Apartments, The Byway also has 10,000 square feet of retail space. The multifamily portion was completed late last year and the retail space is expected to be completed by the end of this second quarter of this year.

Fund Developments

The Byway is one of the three initial properties developed through the fund. Pacific Oak Capital announced in July 2019 it was funding the $33 million development of the project.

The other two properties are in the Phoenix area. Imperial Apartments is a low-rise, suburban multifamily property with 140 units located east of downtown Phoenix. Construction was completed in the last half of 2021. St. Ambrose Apartments is a low-rise, suburban-style multifamily property with 241 units. It is slated for completion during the third quarter.

McMillan said lease-up rates and rental levels at both Imperial Apartments and The Byway have been strong and ahead of initial projections.

Pacific Oak Capital Advisors and its numerous affiliated companies currently manage a diverse portfolio of real estate valued at more than $4 billion. Pacific Oak Capital Markets is a wholesaler and managing broker-dealer for alternatives investment offerings.

You May Also Like