Harrison Street Raises $2.5B for Eighth Opportunistic Real Estate Fund

Harrison Street has announced the final close of the firm’s eighth US opportunistic real estate fund, Harrison Street Real Estate Partners VIII, L.P. at the fund’s hard cap of $2 billion, exceeding its $1.5 billion target.

Harrison Street raised an additional $510 million in co-investment vehicles to invest alongside Fund VIII for a total of $2.5 billion of equity raised and total buying capacity of over $8 billion. The fund received support from current Harrison Street investors, making up 75% of the commitments, as well as new institutional investors from around the globe.

Fund VIII builds on Harrison Street’s opportunistic fund series, which generate value through acquisition, development, and repositioning of assets in partnership with experienced operating partners. 

The first half of 2021 was one of the most active periods in the firm’s history, it said. 

Fund VIII has investments across senior housing, student housing, healthcare delivery, medical office, life sciences and storage real estate as well as digital realty and build-to-rent single family housing. 

Overcoming a Black Swan Event

“The closing of Fund VIII, the largest closed-end fund in our firm’s history, amid a black swan event, is a testament to the resiliency of our asset classes, the strength of our investment platform, and confidence placed in us by our global investors, both existing and new,” Christopher Merrill, Harrison Street’s co-founder, chairman and CEO, said in prepared remarks.

Harrison Street has closed on $15 billion in new investment activity and received strong support from its investor base with $6.9 billion of capital commitments raised across its strategies since the onset of the pandemic. 

Harrison Street is currently the largest private owner of student housing, a top 5 owner of senior housing and a market leader in other sectors such as medical office and life sciences. To date, Fund VIII has committed 53% of its total equity across 76 assets, 28 MSAs and in partnership with 29 best-in-class operators.

Opportunistic Capital 

Harrison Street’s fund is the latest example of real estate private equity amassing capital for investment in various asset classes. Also this week, KKR announced the final closing of KKR Real Estate Partners Americas III, a $4.3 billion fund dedicated to opportunistic real estate investments primarily in the U.S. 

And last month Morgan Stanley Real Estate Investing announced it raised $3.1 billion for North Haven Real Estate Fund X Global, exceeding its original fundraising target and surpassing the size of its predecessor fund, North Haven Real Estate Fund IX Global.