American South Fund Management Closes Affordble Housing Fund with $174 Million in Equity Commitments

GCM Grosvenor commits $50 million to fund, representing first public pension fund capital
By: American South Fund Management
 
LOS ANGELES - Feb. 5, 2024 - PRLog -- Emerging manager American South Fund Management (ASFM), a joint venture between SDS Capital Group and Vintage Realty, has successfully closed on its American South Real Estate Fund II ("ASREF II") with $174 million in equity commitments, nearly three times the size of its debut impact fund ASREF I.

ASFM, through the ASREF I and II funds, provides preferred equity and equity financing for real estate sponsors with projects located in 10 Southern states (Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee and Texas). The ASREF I and II funds have, to date, collectively committed $106M to 22 projects, financing 5,147 housing units – 81% of them affordable to families at less than 80% of the area median income (AMI). ASFM is also an outlier in the real estate industry, as a majority woman-owned real estate fund manager.

While the investors in ASREF II are predominantly financial institutions, a $50 million investment from funds managed by GCM Grosvenor represents the first public pension capital to be committed to ASFM's funds.

Funds managed by emerging managers are by definition smaller, often less than $500 million. This scale creates a challenge relative to securing capital from most public pension funds as the vast amount of capital they must deploy can require the size of individual pension fund investments to be substantially larger than what most emerging managers can absorb within a single fund.

GCM Grosvenor has been managing emerging manager capital in real estate since 2010, and currently manages more than $5 billion of real estate emerging manager programs. GCM invested in ASREF II from funds managed on behalf of five public pension plan investors.

"We are so fortunate to partner with ASFM in delivering affordable housing to communities that need it most," said Peter Braffman, Managing Director at GCM Grosvenor. "The ASREF II investment closely aligns with our focus on identifying firms representing compelling strategic partnerships, and we look forward to the opportunity the fund presents to deliver positive outcomes to our investors."

GCM Grosvenor's investment significantly contributes to ASREF's ability to provide more affordable housing within communities across the South.

"ASREF cannot grow if we are unable to secure public pension fund capital – it's that simple," explains Deborah La Franchi, ASFM Managing Partner and Founder and CEO of SDS Capital Group.  "ASREF could not tap into this capital without the GCM Grosvenor platform, which suballocates and bundles pension fund capital into amounts scaled for the smaller-sized funds of emerging managers such as ASFM."
"The success of the ASREF II is a testament to our investment strategy," said David Alexander, ASFM Managing Partner and CEO of Vintage Reality Company. "We are financing affordable housing units in communities that have a deep desire for this housing yet confront a stagnant supply within their communities. We are deeply grateful to each of our investors who support our investment strategy and mission."

About GCM Grosvenor
GCM Grosvenor  is a global alternative asset management solutions provider with approximately $76 billion in assets under management across private equity, infrastructure, real estate, credit, and absolute return investment strategies. The firm has specialized in alternatives for more than 50 years and is dedicated to delivering value for clients by leveraging its cross-asset class and flexible investment platform. GCM Grosvenor's experienced team of approximately 540 professionals serves a global client base of institutional and individual investors. The firm is headquartered in Chicago, with offices in New York, Toronto, London, Frankfurt, Tokyo, Hong Kong, Seoul and Sydney. For more information, visit: gcmgrosvenor.com.

About American South Real Estate Fund I & II
American South Real Estate Fund I&II are real estate impact funds focused on investing in transformative projects in 10 states across the Southern U.S. American South Fund Management, the sponsor of ASREF I&II, is a joint venture between  Los Angeles-based impact fund manager SDS Capital Group (www.sds.capital) and Vintage Realty Company, a Shreveport, Louisiana-based property developer/manager (www.vintagerealty.com).

About SDS Capital Group
SDS Capital Group (http://www.sds.capital)  manages five impact funds. SDS has been selected as an ImpactAssets 50 investment manager for the past six consecutive years, earning the prestigious "emeritus" status within this most globally recognized database of impact fund managers. Founded in 1988, Vintage Realty Company is a leading multifamily real estate developer with more than 180 team members and projects located throughout the South. The partnership leverages their combined real estate experience to finance impactful projects that benefit distressed communities of color throughout the South. ASREF I and II have made investments in communities that are on average 67% minority and suffer from a poverty rate of 29%. For more information, visit asref.com

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Source:American South Fund Management
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Tags:Affordable Housing
Industry:Real Estate
Location:Los Angeles - California - United States
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