OneWall Partners Launches $50M Workforce Housing Fund
The five-year fund has a preferred return of 9% to 10%, and a target return of 11% to 13% annualized net of fees and expenses.
NEW YORK CITY— OneWall Partners, an investment management firm focused on workforce housing, has launched the Nova Appian Preferred Income Fund I, a $50m preferred equity fund aimed at transit-oriented workforce housing in the northeast.
The five-year fund has a preferred return of 9% to 10%, and a target return of 11% to 13% annualized net of fees and expenses. Since the announcement, OneWall has committed $2.5m and received soft commitments from accredited investors, as well as three institutional investors for an estimated $15 million investment. OneWall has been in the workforce housing game for some time and launched the fund to achieve diversified and risk-adjusted returns in an asset class it knows best; transit and lifestyle-oriented workforce housing. The firm plans to acquire 8 to 15 multi-family residential assets in Pennsylvania, New Jersey, New York and Connecticut.
They’ve identified six transactions totaling more than 1,800 apartment units and representing a preferred equity investment of up to $27 million.
Properties that check the box are walkable, transit-oriented urban communities and suburban communities with value-add investment opportunities close to major employment centers, where demand for affordable housing is high. OneWall targets submarkets that are typically less competitive and undervalued, in close proximity to more competitive, high-priced markets,
OneWall has completed over $20 billion of real estate and private equity transactions and acquired and recapitalized 69 properties with an aggregate purchase price of $561 million.
The firm finds preferred equity investments are popular with its investor base, who include high-net-worth individuals, family offices and institutions. “Preferred equity provides an extra margin of safety for investors, and the workforce housing asset class has been resilient and stable during various economic cycles,” said Nate Kline, partner and chief investment officer at OneWall, in a prepared statement.
Demand has greatly outpaced supply for workforce housing, which the firm believes will not abate for years because there is a systemic imbalance in the market place. Also, sustainable social and demographic trends have created the perfect storm to drive increased renter populations.