From Left to Right – Robert Lindner and John Carrick, Co-Founders of Integrated Capital Management
Integrated Capital Management closed its first private equity fund this month oversubscribed with $30 million in commitments. The fund is fully diversified across asset classes and geographies, and ICM founders Robert Lindner and John Carrick are banking on that diversification. The fund will offer an option to investors looking for true diversification.
“The Fund is a single source solution for a person who wants a truly diversified commercial real estate portfolio—different asset types, different markets and different sponsors,” Carrick, co-founder and managing principal at ICM, tells GlobeSt.com. “Our fund checks the box for them.”
The fund will focus on light value-add and opportunistic opportunities. Sponsors of stabilized assets typically avoid the fund structure in favor of doing deals directly, but this model will give those sponsors the opportunity to increase their portfolio and reduce financial risk. “Integrated's investment strategy is focused on helping experienced owners, operators and developers of commercial real estate to scale their platforms, control opportunities, and increase assets under management by mitigating any related financial constraints,” Lindner, co-founder and managing principal at ICM, tells GlobeSt.com. “We make sliver equity investments alongside institutional capital sources in institutional-quality assets. Our investors participate in transactions, which are not otherwise accessible on a retail basis and generate higher returns than their institutional investment partners.”
Carrick underscores the fund strategy. “Core investment is more premised upon an asset allocation model, and this style of investor generally does not offer sponsors a promoted interest or performance bonus due to the lack of value creation,” he says. “Our passion is to empower best of class sponsors to create value and to achieve superior risk-adjusted returns for our investors by negotiating a participation in the resultant promote.”
The fund's initial investments are focused on the Southeast and in Southern California, but each opportunity is vetted separately based on location, property characteristics and risk profile. “Our average investment is typically underwritten over a three to four year term in order to execute the applicable value creation, stabilize the subsequent cash flow, and exit the investment,” says Lindner. “We expect to fully allocate the Fund in approximately 15-18 months, and it is estimated to have a six-year life. Our objective is not simply to maximize IRR, but rather to thoughtfully mitigate risk while simultaneously creating multiples per invested dollar for our investor.”
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Kelsi Maree Borland
