Banner Oak Capital Has $800M To Spend With Growth-Focused Real Estate Companies
Banner Oak Capital Partners, with investment from the Teacher Retirement System of Texas, closed on two new funds totaling $800M to invest in real estate platforms and assets with a particular eye to student housing, medical office, data centers and manufactured housing.
Banner Oak Operating Company Fund is being called “programmatic equity capital,” meaning the money will go toward companies and teams that invest in real estate (typically as general partner co-investment capital), not toward specific properties.
President Geoff Osborn said his company will finance experienced real estate companies looking to expand their platforms. The company already has investments in multifamily, industrial, senior housing and retail, so it is looking for teams with track records in other asset classes with the potential to grow their businesses to a national scale, whether through acquisitions or development. Banner Oak invests as an active partner and takes part in underwriting and forming business plans, Osborn said. The Dallas-based company is looking for opportunities nationwide.
“Banner Oak has a long track record of working effectively with management teams to provide flexible, creative capital solutions to allow for value creation at both the asset and enterprise level,” Banner Oak CEO Patricia Gibson said in a statement. “We seek to be a value-added partner, focused on long-term relationships where we can provide resources beyond capital to help scale best-in-class real estate platforms.”
That said, Osborn said Banner Oak typically seeks opportunistic and value-add returns from its operating companies.
“We have not historically looked to our operating companies as vehicles to hold long-term, core assets, as we have other programs for those types of investments,” Osborne said.
The Banner Oak Investment Fund, also part of this $800M fundraise, will be used for direct investments into properties operated by companies Banner Oak invested in through its company fund.
Banner Oak's prior fund, Akard Street Holdings, placed more than $1B in equity capital with operating teams to get $3B worth of gross assets in industrial, multifamily, senior housing, office and retail space.
Banner Oak also recently closed Banner Oak Core and Banner Oak Enhanced Core, investment vehicles with $700M to invest in long-term holds. Banner Oak Multifamily and Banner Oak Industrial have $600M to invest between them to enhance the capital allocation of other Banner Oak platforms. The company was founded in 2016 by Hunt Realty Investments executives Osborn and Gibson when Hunt sold the Akard Street Partners platform to the Teacher Retirement System of Texas.