FCP Closes $755M Real Estate Fund For East Coast, Texas Investments

FCP Managing Partner Esko Korhonen
Bisnow: Jon Banister
Fcp Managing Partner Esko Korhonen At A 2017 Bisnow Event

A Chevy Chase, Maryland-based investment company has surpassed the target for its latest real estate fund, raising over three-quarters of a billion dollars.

FCP announced Monday it closed the fund, FCP Realty Fund IV L.P. after raising $755M to put toward multifamily and commercial properties in the eastern U.S. and Texas.

The $755M haul far outpaced its previous $512M fund, and it surpassed the $700M goal FCP set late last year. FCP worked with Evercore Group on the fundraising effort.

The firm said the fund will accommodate $2.5B of total investments. It said it has the flexibility to invest in various parts of the capital stack, including equity, preferred equity, mezzanine debt or a combination of the three. The fund has already closed on one investment, an adaptive reuse creative office project in Nashville.

"FCP is extremely pleased with investors' appetites for our value-add Fund IV offering," FCP Managing Partner Esko Korhonen said in a release. "Since our inception, FCP has built a robust operating platform allowing us to effectively deploy fund capital."

The firm has largely focused its portfolio on Class-B and Class-C apartments, which it sees as a hedge against rising interest rates, and value-add commercial office properties, Korhonen said. FCP in March sold a Dulles office building, which it filled with Amazon Web Services, for $226M, a massive increase from the $84M it paid for the property in 2015 ahead of its previous anchor tenant's departure.

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