A fund has been created in the US which aims to make real estate portfolio acquisitions in the secondary market. Mark Berman and Scott Landress, partners at Liquid Realty, have established Liquid Realty Partners. Formed in 2001 Liquid Realty is currently acquiring portfolios from $2 to $250m, and is currently in talks with institutions regarding the acquisition of two significant pools of opportunistic real estate fund interests.
Partner Mark Berman believes that LRP will service a growing need for liquidity in the real estate market. “The secondary market for real estate partnership interests is likely to explode over the next 24 months, much the way it has for other types of private equity. While institutional investors have many liquidity options for secondary sales of their other private equity interests, they currently have very few options for their private real estate fund investments.”
The firm will be looking predominantly at investments in the US, although Europe is also an area of interest, according to Berman. “Some secondary sellers are selling earlier vintage year partnership interests and taking the proceeds to reinvest in funds with an international focus. This allows the institution to get more exposure to overseas assets without increasing their overall allocation to real estate. Given that we purchase secondary limited partner interests we do expect to become investors in both funds with a domestic focus and those with an overseas focus.”
Liquid Realty also announced today that Bryon Sheets, partner at Paul Capital Partners, a US private equity secondary firm with over $2bn under management, will become a member of Liquid Realty’s advisory board.