Grosvenor to reverse investment freeze on US residential(2)

The fund management arm of the British property group, owned by the Duke of Westminster, is set to make its first investment from its Grosvenor Residential Investment Partners fund, which closed last year on $100m.

Grosvenor US, the fund management arm of the British property development firm Grosvenor, is poised to reverse its freeze on investments from its Grosvenor Residential Investment Partners fund saying the market was now looking more attractive.

The firm, part of the Grosvenor family’s empire and headed by the sixth Duke of Westminster, said it was now actively pursuing a number of deals after closing the fund last year on $100 million (€64 million). The Philadelphia-based firm said it had opted to postpone deploying its capital owing to the credit crisis.

Speaking to PERE, Grosvenor US president Doug Callantine said the real estate market – although not at the bottom in relation to re-pricing – was “getting close to bottom,” allowing the firm to actively search for deals. The fund will focus on residential land acquisitions, in particular providing equity to developers and homebuilders. Callantine expected the fund to be fully invested over the next 12 months.

Grosvenor US is also set to target the New York multi-family rental market in the near future, with ground-up developments in the city and surrounding area. “The demographics of New York show demand for rental housing in the area increasing,” Callantine added.

The parent company, Grosvenor, which also controls approximately 300 acres of prime central London real estate including vast swathes of Mayfair and Belgravia, branched out into fund management in 2005, buying asset manager Legg Mason Real Estate in 2006 to help boost its fund management presence in North America and Canada.

According to Callantine, who was the former president of Legg Mason before the acquisition, Grosvenor has around $6 billion in assets under management – a figure the firm planned to double over the next five to eight years. “We see the fund management business growing significantly, not only here but internationally. It may be ambitious but we believe this is very achievable,” he said.