Investcorp Further Expands Real Estate Portfolio with Acquisition of Five Residential Properties

20 Mar 2016

Investcorp, a leading provider and manager of alternative investment products, today announced that its U.S.-based real estate arm, through two separate transactions, has acquired five residential properties in the metropolitan areas of Boca Raton, Florida and Minneapolis, Minnesota for approximately $220 million.

The acquisitions are consistent with Investcorp’s strategy to invest in desirable, high quality properties located in high demand markets providing attractive cash yields. The Boca Raton properties are comprised of three student housing properties in Boca Raton, FL. With 892 beds and a 98 percent occupancy rate, these properties are the only off-campus, purpose-built, student housing facilities in the nearby area. The residential properties located in the suburbs of Minneapolis, MN are comprised of two multifamily apartment properties with 854 units and an average occupancy rate of 95 percent. Minneapolis has the lowest unemployment rate in the U.S. at 2.9%, and has outperformed the national unemployment rate.

As the home ownership rate in the U.S. continues to decline, rental properties are in high demand,” said Mohammed Al-Shroogi, Co-CEO at Investcorp. “All five of these properties are located in major metropolitan areas with strong market fundamentals including solid rent growth and high occupancy rates. We believe the unique Boca Raton properties serve a growing student population in the area, and the Minneapolis multifamily properties have significant upside potential associated with exterior and interior upgrades.”

Fahad Murad, Managing Director at Investcorp for Bahrain, said, “We are pleased to add these properties to Investcorp’s U.S. real estate portfolio. A mix of multi-family and student accommodation, these properties benefit from high occupancy rates and locations in high-demand markets. We believe that these acquisitions further strengthen our presence in the U.S. real estate market.”

Boca Student Housing (BSH) in Boca Raton, Florida: The BSH, comprised of University Park, University View and University Square, are Class A “rent by the bed” properties located in the affluent Boca Raton, FL and serving the housing needs of students from three local universities all in growth mode: Florida Atlantic University, Palm Beach State College and Lynn University. These properties have a combined 892 beds and boast amenities specifically designed for students such as common amenity areas, fitness centers and shuttle service to and from Florida Atlantic University.  They offer a resort-like setting and are among the most sought after rental properties in the area.

Hampshire Hill, Bloomington, Minnesota: A 534 unit garden style multifamily apartment complex, Hampshire Hill is located approximately 16 miles from downtown Minneapolis. The property contains a mix of studio, one, and two bedroom units that have spacious floor plans, complete with landscaped grounds, pool, fitness center and laundry rooms. The property is also conveniently located near several major highways and in close proximity to several leading employers.

Southwind Village, Burnsville, Minnesota: Southwind Village is a 320 unit townhome style property less than 20 miles from downtown Minneapolis. The property boasts a newly renovated fitness center, outdoor swimming pools and a six-acre park. The property is located near several large companies including Pepsi Bottling Group, UTC Aerospace Systems and Fairview Ridge Hospital. Located within the award- winning Lakeville Public Schools area and with easy access to many entertainment activities including Buck Hill Ski Area and Valleyfair Amusement park, the complex is an attractive option for families looking to reside in one of the fastest growing metropolitan areas in the U.S.

Investcorp’s total real estate acquisitions in the last twelve months total approximately $1.5 billion. In the last twenty years, Investcorp has completed over 400 property investments totaling more than $13 billion in value. The Firm’s real estate investments span industrial, commercial and residential properties within the top 30 largest markets in the U.S., including the recent acquisition of a prime office building in Washington, D.C., an industrial portfolio in Atlanta and office buildings in the submarkets of Atlanta, San Francisco and Boston.