Minneapolis (April 19, 2021) — Real estate investment, management and development firm Timberland Partners has announced the launch of its eighth multi-asset real estate fund.
Through Timberland Partners Apartment Fund VIII, LLC (TPAF VIII), the firm plans to raise $50 million to acquire and manage quality multifamily rental properties, significantly growing its portfolio. To kick off the fund, Timberland is acquiring Class-A properties in Tulsa, OK and St. Louis, MO, with plans to add more apartment communities across the central and southeastern United States.
TPAF VIII will focus on properties that can be enhanced through renovation and strong property management. The Fund’s geographic focus will be suburban locations in secondary and tertiary markets with strong growth fundamentals, and those that attract less interest from larger, institutional buyers.
Current market conditions make it an opportune time to launch TPAF VIII. Historically low interest rates, and a pandemic-driven demand for space are pushing competition for single-family homes to almost historic levels. According to industry analysts, the median price of an existing single-family home increased nearly 15 percent from January 2020 to January 2021. Over the same period, supply for existing homes decreased nearly 30 percent.
This imbalance in supply and demand has motivated Millennials, downsizing Baby Boomers, and others to explore suburban apartment living as an alternative to home ownership, especially in lower cost-of-living markets.
In addition, the U.S. economy is rebounding as employers ramp up hiring, and more Americans receive COVID-19 vaccinations. This economic growth should fuel increases in both rental rates and asset values in the years to come.
As with previous investment offerings, Timberland Partners will work to increase the long-term value of properties acquired in TPAF VIII through lease-ups, strategic capital improvements, and improved operations. Timberland Partners’ highly experienced team specializes in the multifamily sector. Their expertise and industry connections in the brokerage and lending industries help to source off-market deals with attractive debt terms.
Since founding the company, Timberland Partners’ disciplined, value-add investment philosophy has produced strong risk-adjusted returns for investors with a blend of consistent cash distributions and capital appreciation, with a low-correlation to public market alternatives. That same strategy will guide the investments for TPAF VIII.
“We are very bullish on the multifamily real estate market. We firmly believe our investment strategy combined with our deep multifamily industry knowledge can produce meaningful results for our partners with this fund,” said Bob Fransen, President of Timberland Partners. “We have had significant success in previous investment opportunities, and I am confident we will equal that performance with TPAF VIII. The state of world affairs has created exciting opportunities within the multifamily sector. We have the right people and the right plan in place to capitalize to the benefit of both our individual and institutional partners.”