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Tuesday, 15 May 2018

Indianapolis Developer Raises Initial Fund, Targets Workforce Housing

Buckingham Cos., an Indianapolis developer that has accumulated a portfolio of some $1.5 billion of properties for its own account, has raised its first commingled fund through which it will invest in workforce-housing properties. It's raised $175 million for its Buckingham Multifamily Fund I, which could make up to $500 million of investments, or so, after leverage.

Commercial Real Estate Direct Staff Report

Buckingham Cos., an Indianapolis developer that has accumulated a portfolio of some $1.5 billion of properties for its own account, has raised its first commingled fund through which it will invest in workforce-housing properties.

The company raised $175 million for its Buckingham Multifamily Fund I, tapping a small group of institutional investors, most of which it had previous relationships with. The fund's already circled six apartment properties, in suburban Indianapolis, Cincinnati and Nashville, Tenn., with a total of roughly 1,800 units.

The thinking is the fund would leverage its capital with mortgage debt - likely from the housing-financing agencies - giving it a potential capacity of some $500 million or so of investments.

The company then likely would raise a follow-up vehicle.

Buckingham in the past had made property investments using its own capital and by partnering with third parties. During the Great Financial Crisis, it bought a portfolio of properties, and in doing so determined that it could leverage its strong construction, development and management background into an investment-management platform. It purposely went small for its initial fund so as not to spend too much time in the capital-raising process.

It also wanted to efficiently develop a track record that...


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