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TH Real Estate closes multifamily housing Fund and targets $400m in value-add properties

Jay Martha

After raising $245m equity from investors, including three large US state pension plans, that are repeat investors and a German pension fund, TH Real Estate has closed its seventh in a series of multifamily housing club funds.

With leverage, the equity commitments will allow the Fund to target a portfolio of approximately $400m. The Fund is focused primarily on US value-add rental housing and seeks to provide its investors enhanced returns with high sustainable income. 

"The multifamily housing strategy takes an integrated approach, combining multiple value-enhancing investment strategies with income-enhancing, low-cost specialty bond financing to meet its goals," said Jay Martha, TH Real Estate's Head of US Multifamily Investments. "The team executing this strategy has worked together for decades, successfully navigating multiple market cycles and we are pleased to have completed this latest fundraise."   

Overall, TH Real Estate's US multifamily housing investment platform serves numerous funds and mandates and has 32,000 units in urban luxury, workforce and student housing assets under management, totaling $10bn.

"Institutional investor interest in US rental housing remains strong, reflecting the opportunities created by the current economic and demographic trends impacting this sector," added Jay Martha. "As one of the largest multifamily investors in the world*, our varied strategies for investment in US housing are designed to meet the broad demands of a large and diverse renter pool."

Since its initial close, the Fund’s portfolio has acquired seven properties, five of which are currently in the process of being financed through municipal bonds that are exempt from federal, and in some instances, state income tax, in exchange for providing affordable workforce housing to communities. Tax-exempt bonds are issued for the development or rehabilitation of market rate housing. This debt strategy provides below market cost-of-financing for the fund, provides high-quality workforce housing where demand is high and can enhance income returns for the investors.

The seven properties acquired for the Fund portfolio to date are:

  • The Nine on Shoreline – Austin, TX
    Waterstone Apartments –  Los Angeles, CA
  • Bristol Village –  Minneapolis, MN
  • The Pillars at Great Bridge –  Chesapeake, VA
  • Ivy Hill –  Walnut Creek, CA
  • The Landings –  Coconut Creek, FL
  • Rancho Hills –  San Diego, CA      

*Ranked the 8th largest manager of multifamily properties globally by AUM and 3rd largest in the US by IPE Real Estate, Nov/December 2016.

TH Real Estate is a name under which Nuveen Real Estate Management Limited provides investment products and services. TH Real Estate is an investment affiliate of Nuveen, LLC (“Nuveen”), the investment management arm of TIAA. Issued by Nuveen Real Estate Management Limited, 201 Bishopsgate, EC2M 3BN. Authorised and regulated by the Financial Conduct Authority. TH Real Estate is a name under which Nuveen Real Estate Management Limited provides investment products and services. COMP201700614

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