FOURTH FUND CLOSED

Alex. Brown Realty CEO John Prugh's Baltimore-based firm has closed its fourth fund at $276M. About 80% came from 15 US-based investors (some foreign investors could still pitch in), slightly above its goal. West Virginia Investment Management Board, Montana Board of Investments, and Baltimore City Fire & PoliceEmployees' Retirement System were among the large contributors. John tells us pension funds are showing signs of life, boosted by a volatile stock market. Most are underfunded and need higher returns. Real estate provides those now, not to mention some immediate cash yield (used to be that people just baked cookies for our policemen and firemen).
ABR Chesapeake Fund IV will go after mid-cap properties that need to be recapped, redeveloped, or repositioned. It'll be invested by mid-2015 (at the third fund's average pace of $5M equity investment per deal, that would be about 50 assets) and will hold for three to seven years, liquidating as assets sell. John tells us ABR is a JV investor and so will go where its traditional partners are. In the Mid-Atlantic, which typically draws a third of the firm's capital, a big partner is Manekin. "It would be surprising," John says, "if Fund IV does not invest again in the Baltimore/Washington market." ABR's third fund is invested in Manekin's five-building, 295k SF Water's Edge Corporate Campus (above) in Harford County.

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