News and Announcements
US Residential Fund Enters US Apartment Market
- Published February 06, 2017 12:00AM UTC
- Publisher Wholesale Investor
- Categories Company Updates
An Australian-based real estate investment fund seeking to switch from single-family home investing in the U.S to multifamily properties of an apartment community in Hillsborough.
KEY TAKEAWAYS:
- A joint-venture partnership between US Residential Fund (ASE: USR), a publicly-traded company based in Sydney, Australia, and 10 Federal of Raleigh has paid $21.5 million for the 240-unit Patriot’s Pointe apartment community.
- USR’s investments had been entirely in single-family houses acquired during the financial crisis.
- March 2016, it had ownership in 140 single-family homes in Texas, Georgia and Ohio, and is in the process of winding down that portfolio through the sale of the properties.
Andrew Meakin, managing director at US Residential Fund, says the Patriot’s Point apartments is the company’s only investment in North Carolina, so far. “However, I will be in North Carolina in the next few weeks for further discussions with our partners,” he writes in an email. “US Residential Fund is looking to expand its reach in North Carolina and is on the lookout for additional assets.”
According to USR documents, it has surmised that the property is “significantly under rented” with an initial yield of 6 percent. Occupancy was around 90 percent in January, Meakin says.
“We believe that improvements in asset management will increase occupancy and deliver increased rents in the near term,” the company states in a news release about the deal. USR in its pitch to investors has stated that it is targeting an 8.4 percent average annual yield and a 15-17 percent internal rate of return for investors of Patriot’s Pointe.
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