AREP close its third GP Fund raising $63m

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American Real Estate Partners (AREP) has closed its third real estate general partner (GP) fund, called AREP Strategic Opportunity Fund III (Fund III) raising $63 million in equity commitments.

“As we announce the closing of our third fund, we would like to thank our partners and their advisors for their support,” said Brian Katz, co-founder & president of AREP.

“The successful closing of Fund III is an endorsement of our multi-asset investment approach and differentiated strategy and a testament to the strength of our team. We’re extremely optimistic about Fund III and its specified assets and look forward to putting the balance of Fund III's capital to work thoughtfully and prudently.”

As with previous funds of this kind, Fund III's commitments will be used as co-investment capital for the institutional joint ventures that Fund III will sponsor and AREP, an institutional fund manager and operating partner, has established over its 20-year lifespan.

Fund III’s co-investment capital is targeted to invest in $1.5 billion to $2 billion of its total asset value, with AREP having pre-allocated roughly 30% of Fund III in three data centres that are being developed as part of a $1 billion joint venture with Harrison Street Real Estate Capital and a residential land development project with Westbrook Partners.

“We are grateful for the support of our investors, who trust in our stewardship of their capital with our ability to invest in these historic times to produce risk-adjusted opportunity level returns,” said Doug Fleit, co-founder & CEO of AREP.

“With our extensive track record and experience in the markets and industry segments in which we invest, we are very well positioned to continue to capitalise on opportunities that meet our objectives through an ever-evolving investment climate."

AREP has historically raised its GP fund capital from a mix of public and private institutional investors and family offices, Fund III continues this trend and broadens AREP’s investor base by including a significant number of high-net-worth individuals.