Family Office, RMR Launch $500M Office Fund
It will acquire middle market, multi-tenant office buildings located in urban infill and suburban locations in non-gateway US markets.
NEWTON, MA–The RMR Group and ABP Trust are launching an office fund with an immediate purchasing power of $300 million — which is expected to grow to $500 million — and that has been seeded with 15 office buildings owned by ABP, otherwise known as the Portnoy Family Office, that are worth $206 million. RMR is committing $100 million to the endeavor, which is called the RMR Office Property Fund LP.
It will be a private, open end core fund focused on acquiring middle market, multi-tenant office buildings in urban infill and suburban locations in non-gateway US markets. The fund defines middle market office properties to be larger than 50,000 square feet but valued at less than $100 million.
The fund will be marketed to private investors and is targeting 8% to 10% annual returns through a combination of current income and long-term capital appreciation.
The fund plans to leverage the assets the Portnoy Family Office has contributed by 40%. All of these properties are unencumbered by any debt. These buildings are located in Austin, TX, Northern Virginia, suburban Boston, MA and suburban Philadelphia, PA. They total 1.1 million square feet and on a combined basis are 89% occupied for a 3.5 year weighted (by rental revenues) average remaining lease term.