Monday, January 31, 2022
By Staff Writer
Pine Capital Investment Advisors (PCIA) announced the closing of its third Real Estate Fund (PCIA RE III). Over the last few years, private equity investments in income yielding commercial, Industrial, residential and data centres have increased significantly. The increase is primarily led by changing institutional investor allocations across the world. LSMManagement acted as the strategic consulting firm advising on various functions including leading tothe second close.
Mr. Tim Sethers, Executive Director at LSM Management said,"Pine Capital completed the final close of more than USD 300mn which will be invested in the established residential markets of Miami, Austin, Atlanta, Washington D.C., Orlando, Los Angeles, Charlotte and Phoenix. Domestic investors account for 45% of the real estate fund raised, while overseas investors account for the remaining 65%. Family Offices and Private Investment Firms from GCC represented the majority of overseas limited partners in Fund III.Pine Capital is targeting a IRR of 15 – 20%"
"We have finalised fewinvestments and are prepared for accelerated deployment given a very healthy pipeline and a structurally resilient residential segment.", he added.
On a comment request on the investor trends in 1Q22, Mr. Ali Maradi Hussiani, Head of Sales - Middle East at LSM Management said,"The swift rebound, as indicated by asignificant increase in sales velocity following the Covid period, has been very encouraging. We believe the residential market is already on a growth trajectory in 2022 and is likely to follow the same trend in the coming years. Selection of suitable developers, relevant micro markets and entryat the right price have always been our strength. Our portfolio projects have shown robust performance and witnessed y-o-y growth of more than 70% in sales value in FY2021-22. The average prices have risen by over 10% and this is likely to sustain given the increase in purchasing power in the segment."
According to LSM Management, end user demand combined with declining inventory on one side and employment generation combined with income growth in service industry, IT, financial services and allied sectors are the drivers for sustained demand in residential sector. The U.S. multifamily sector saw strong momentum at the start of 2022, with robust demographic trends underpinning record leasing activity, rent growth and investment during the first quarter. Investment in the multifamily sector increased by 56% year-over-year to $63 billion in Q1 2022—the strongest first quarter on record and bringing the trailing 4-quarter total to $374 billion. Multifamily accounted for 37% of total commercial real estate investment volume in Q1 2022, followed by office at 21% and industrial at 20%. The multifamily market set a record four-quarter absorption total of 695,100 units in Q1 2022—up 12% from the previous quarter and 77% higher than the previous annual record of 393,000 units in 2000. Net absorption of 96,500 units was the highest Q1 2022 total since2000.
About Pine Capital:
Pine Capital is a investment firm focussed on unlocking value in the real estate market for investors since 2002. The firm has sailed through multiple business cycles, downturns returning capital to its investors with top quartile performance across various direct transactions and fund vehicles. Within its Real Estate activities, the firm has closed Fund I in 2006 and Fund II in 2016.
About LSM Management:
LSM Management is a highly integrated creator, placer and man- ager of alternative capital company with an international presence. Our focus on Institutional Investors drives us to provide sophisticated quality services. Our clients engage us for complex, demanding and time- intensive projects. LSM Management designs and implements holistic wealth management solutions in today’s complex regulatory environment. LSM Management focuses on a selected few geographic markets, which has allowed us to build up the expertise and resources required to provide comprehensive services to our clients. We bridge the Middle East, Far East and select European Institutional Investor with Fund and Investment Opportunities in the West.
