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3/14/16
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Trion Properties, a Los Angeles-based private equity firm that specializes in value-add multifamily investments, has launched its first investment fund vehicle. The fund, which will target $30 mil in equity to reach $100 mil in buying power, will invest in the acquisition, improvement, and repositioning of undervalued multifamily assets in four core markets, including Los Angeles, San Diego, the Bay Area and Portland, Oregon.
“The time is right to transition from a real estate syndication vehicle to a private equity fund vehicle,” says Max Sharkansky, Managing Partner and Co-Founder of Trion Properties. “Preqin recently reported that the biggest challenge facing private real estate fund managers in 2016 will be finding attractive investment opportunities. Our firm has a deep pipeline of opportunities that we’ve already identified, and the shift to a private equity fund will allow us to take full advantage of these opportunities as they arise, increasing activity in our target markets.”
Trion Properties has already closed over $100 mil in transactions, demonstrating its pipeline and strategic capabilities. To date, the firm has taken 20 properties full cycle, averaging an internal rate of return of 30 percent.
“We knew that launching a first time fund would be extremely competitive, and we had to prove ourselves from the start,” explains Sharkansky. “Our returns to date have done just that. We started by identifying deals in our niche markets and raised capital from a small pool of investors. From there, we executed on our strategy and successfully developed a proven track record that can help us to demonstrate the potential that our platform presents to investors.”
The key to the platform’s success lies in its hyper-narrow focus, according to Mitch Paskover, Managing Partner and Co-Founder of Trion Properties.
“Our unique selling point is our niche strategy. We invest in undermanaged multifamily properties in supply-constrained markets with high barriers to entry,” says Paskover. “Because we’re so focused, we bring a deeper expertise in this product type and geography than our competitors. By staying true to what we do best, we remain poised to deliver extremely strong yields over time.”
Trion Properties’ debut fund will invest in value-add apartment communities and urban infill product in Trion’s rapidly expanding target markets. Paskover notes that a key to the firm’s acquisition strategy is selecting assets with longevity and endurance.
“We look beyond short-term projections and ensure that the assets we acquire can maintain strong performance, even if economic pressure arises. By targeting urban infill projects, we’re limiting the downside and ensuring that our assets can weather economic storms,” he explains.
Trion’s current multifamily portfolio encompasses 720 units across Los Angeles, San Diego, the Bay Area, and Portland, Oregon. Based on strong fundamentals and continued demand for multifamily housing in these markets, Trion anticipates strong performance for its investment platform over the long term.
Trion will leverage the current momentum in crowdfunding to garner interest in its debut fund. The firm is partnering with RealCrowd for this initial fundraise. The firm plans to focus on this debut fund, which will seek equity commitments from accredited high net worth investors, and will later seek to launch an institutional fund and continue to build its capital structure for future investments.
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