Waterton Closes $1.5B Multifamily Investment Fund

Venture XIV was first deployed in the acquisition of a 1,824-unit portfolio in the Atlanta metropolitan area.
Image by Victoria Borodinova from Pixabay

Real estate investor and operator Waterton has closed its Waterton Residential Property Venture XIV L.P. The fund has obtained $1.5 billion in equity commitments from a wide-ranging array of international institutional investors, and stands among the largest dedicated U.S. multifamily value-add funds.

Waterton expects to identify a substantial number of opportunities in the multifamily sector, and these should appear nationwide as a result of the COVID recession, the company said in a statement. The fund provides a distinctive opportunity for Waterton to employ a strategy it has used successfully for a quarter century, which calls for leveraging cycle-specific opportunities. It believes those to be currently abundant.

Waterton held the first close for Venture XIV last spring, and the final close this month. Waterton’s in-house investor relations team raised the capital without use of a placement agent. Kirkland & Ellis LLP served as the legal counsel.

Venture XIV was first deployed in the acquisition of a four-property, 1,824-unit Atlanta metropolitan area portfolio. That acquisition closed on Nov. 5, 2020.

After that initial foray, a two-property Hawaii portfolio and three California assets were acquired. As was the case with an earlier $920 million fund in 2018, Venture XIV will pursue urban and suburban opportunities in major U.S. markets. The emphasis will be placed on acquisition of well-located, well-maintained workforce housing in markets with favorable job growth, good employment metrics and solid transportation logistics.

In addition to cycle-specific distressed opportunities, Waterton will target traditional assets with Venture XIV, both benefiting from Waterton’s vertically-integrated design, construction and operations strategy. Plans for Venture XIV call for investing more than $4 billion, including debt, in more than 50 multifamily assets. Last year, Waterton and its architect partner captured Best Value-Add Renovation from MHN‘s Excellence Awards.