Rockwood Latest Investor to Close Fund, Raising $964M

Hoping to capitalize on an unsettled real estate environment that could ultimately lead to the “best investment period in the last 20 years,” private real estate investment firm Rockwood Capital L.L.C. has closed an investment fund with some $964 million in capital commitments. The value-added fund, dubbed Rockwood Capital Real Estate Partners Fund VIII, will primarily invest in hotel, retail, office and residential properties in the United States. Fund VIII has a diverse investor base consisting of public and private pension funds, foundations and endowments, insurance companies and high net worth individuals, the company said. More than half of Fund VIII’s investors have also invested in previous Rockwood funds, and, for the first time, the new fund includes commitments from foreign institutions, including pension plans from Switzerland. Fund VIII will employ Rockwood’s strategy of capitalizing on unique supply/demand imbalances within markets and property sectors to create value. The firm will target assets in settings that emphasize mixed-use environments. Rockwood will continue to work with local partners within supply constrained markets such as Boston, New York City, metro-Washington D.C., Los Angeles, the San Francisco Bay area, and South Florida. “Despite today’s unsettled real estate environment, we believe that we are heading into what could be the best investment period in the last 20 years,” said Tyson Skillings, the fund’s portfolio manager, in a prepared statement. “We are actively analyzing our target markets to ensure that we understand the critical trends and key drivers and that we have identified the best-in-class operators/owners/developers so that as the market recovers, we are well-positioned to take advantage of the opportunities produced from the current depressed conditions.” Rockwood’s is the latest in a spate of recent fund closings, as investors look to take advantage of low pricing levels and distressed sales in the current down market. On April 16, CPN reported that apartment complex developer AvalonBay Communities Inc. closed a $400 million investment fund, $125 million of which was funded by the firm itself, with the remainder coming from institutional investors. With leverage, the fund can make up to about $1.1 billion in investments, most of which will be on properties in high barrier-to-entry markets in the Northeast, mid-Atlantic, Midwest and West Coast, the firm said. And on April 9, CPN reported that Wrightwood Capital closed a $243 million fund. The company’s High Yield Partners II Fund will be invested in recapitalizations, acquisitions and selected new development projects.