New Course
Aug 1, 2007 12:00 PM
As the competition to acquire real estate assets intensifies, a former foreign-backed U.S. investment and management company has partnered with a domestic ally to fund $850 million in acquisitions of commercial real estate at home.
Jamestown, a real estate investor and manager previously funded by German investors, and Griffin Realty Advisors, L.P., have formed a joint venture to broaden its resources among U.S. investors. The deal between the two Atlanta-based firms represents the first time in Jamestown's 25-year history that it will rely on money from stateside investors. Jamestown has purchased more than $8 billion in U.S. real estate.
The partnership plans to raise approximately $300 million by the fall of 2008, leveraging up to 65 percent, to reach its targeted goal of $850 million within two years. As much as 70 percent of the portfolio will be offices and hotels and between 10 percent and 15 percent will be grocery-anchored shopping centers. The remaining 15 percent will be earmarked for multi-family residences.
The joint venture's strategy targets value-added opportunities that offer a lower rate of return because they are less risky than more opportunistic acquisitions. Its expects to generate returns in the low- to mid-teens, according to a spokesman for Griffin.
