Waypoint Residential Seals $103M Fund Following $1.9B in Investment Activity

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Waypoint Residential has closed its subsidiary’s inaugural closed-end commingled fund with $103 million in Fund I equity, Commercial Observer has learned. 

The company completed $1.94 billion in total investment activity across the U.S in 2021, including $661 million from 10 acquisitions and $1.28 billion from 23 sales. 

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Fund I’s capital will be deployed in strategic multifamily investments in the Sun Belt region, an area in which Waypoint said in a release that it anticipates a longer-term housing boom accelerated by the pandemic and residential migrations. 

Founded in 2011, Waypoint has invested in more than 31,000 apartments, representing approximately $5 billion in total investment in both value-add acquisitions and ground-up development. In that time, Waypoint also sold 77 investments, generating more than $3.2 billion in proceeds to investors.

“I am proud of what we have accomplished in our first decade,” said Scott Lawlor, CEO and general partner of Waypoint. “Investing is always challenging, and this has recently been underscored by the unprecedented economic challenges presented by the pandemic. The key to our continued success is having a strong team of experienced, aligned, empowered and motivated people. I am excited by our current team’s ability to continue expanding our history of excellent client service and investment returns.”

Waypoint is now in the market with its second closed-end commingled fund offered by a second subsidiary general partner, Waypoint Strategic Sunbelt Apartment Fund II, and is seeking to raise $200 million in equity. Fund II will continue to focus on development in the Sun Belt. The company believes the best risk-adjusted returns are achieved by delivering new, well-amenitized assets in Sun Belt markets where housing supply has not kept pace with the outsized population and employment growth. Fund II is designed to appeal to both mid-sized institutional and private investors that have historically had limited opportunities to invest in a diversified pool of high-quality multifamily developments, according to the release. 

“Larger institutional investors have been able to gain exposure to development by partnering with merchant builders while private capital has often invested through syndications,” said Reagan Pratt, head of capital markets for Waypoint. “There has been a gap in the investment market, forcing mid-sized institutional investors and private capital either to forgo development altogether or accept asset concentration risk to gain exposure to multifamily development. Fund II fills a tremendous void, as investors will be investing alongside an experienced, diversified, vertically integrated developer, while avoiding the allocator-operator dual fee double promote structure common elsewhere in the market in allocator funds.”

Emily Fu can be reached at efu@commercialobserver.com.