A Philadelphia-based real estate firm has blown past its fundraising goal for a fund set to invest in multifamily real estate assets that have fallen into distress.
Corten Real Estate Management, founded by the executives behind Buccini/Pollin Group, has raised $283M in its latest fund, which had a $250M target, the Philadelphia Business Journal reported.
Corten had more than $500M in assets under management as of the first quarter of 2024. The firm typically targets investments of $10M to $50M and invests in off-market assets, according to a regulatory form filed with the Securities and Exchange Commission.
GCM Grosvenor was the lead investor in the new fund, alongside Stepstone Real Estate and other investment vehicles that include pensions and endowments.
The fund is the firm’s second since its founding by private equity veteran P.J. Yeatman, who serves as managing partner, and his three childhood friends Rob Buccini, Chris Buccini and Dave Pollin, who run Wilmington, Delaware-based owner and developer Buccini/Pollin.
Corten’s long-term focus is to use funds to be bullish where others are bearish during certain market cycles, Yeatman told the PBJ. Corten’s first $150M fund closed in 2021 and invested in hospitality amid the pandemic.
Now, Corten will look for assets with expiring rate caps, especially targeting potential sellers who may have overpaid when rents were shooting up and interest rates were near zero.
“In my 30 years of experience, there's no asset class that is better than [multifamily] over the long haul for a lot of reasons, and you just never get a chance to invest in it at the right cost basis because it is so attractive to capital,” Yeatman told the PBJ.
The firm plans to target Southern properties in markets where there are too many apartments coming online, like North and South Carolina.
“Markets got overbuilt,” Yeatman said. “At the same time, they still benefit from the tailwinds of population growth and economic growth.”
Yeatman previously led private real estate investments for CenterSquare Investment Management and managed investments while at Lubert-Adler Partners.
The Corten-owned local portfolio includes equity investments in 1213 Walnut St. along with the Kennett Square Apartments and Swedesford Park in King of Prussia.
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