LOS ANGELES-Los Angeles-based real estate acquisition and development firm Regent Properties has held the first close of its Regent Office Fund II with $60 million in capital commitments. The fund targets undervalued office product on the West Coast and Texas. The first closing comes only two weeks before the fund closes its first acquisition.

“We think there are select categories of office assets in the Western United States that are mispriced today,” Eric Fleiss, Regent Properties president, tells GlobeSt.com. “This fund is really targeted around purchasing them.” Fleiss could not offer details about fund raising or strategy.

Regent Properties expects the fund to gross a return in the mid-teens with $400 to $500 million in office product acquisitions. The fund has a full year remaining to raise capital, and expects to raise $200 million in commitments by the final close. BlackRock, the world's largest asset manager, is among the fund's initial investors.

“Our first close is all institutional in nature, and we are getting a lot interest from institutional investors,” says Fleiss. “A lot of that is high-net worth, big family offices. We are working with several endowments as well.”

This is Regent Properties' first fund targeting value-add, non-core office product. Mesa West, who has already raised $700 million in commitments for its third fund, has been successful targeting value-add office product but raises capital specifically from pension funds. Regent Properties looks good to achieve similar success. The firm will hold its second close during the winter and a third and final close next summer.

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

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