TruAmerica raises $575M “workforce housing” fund

L.A.-based investor looks to buy across suburban markets

TruAmerica CEO Robert Hart (iStock, LinkedIn via Hart)
TruAmerica CEO Robert Hart (iStock, LinkedIn via Hart)

TruAmerica has raised a new fund that will invest in “workforce housing” developments across U.S. suburban markets.

The Los Angeles-based investment firm raised $575 million from foreign and domestic insurance firms, public and private pension funds, family offices and other asset management funds.

In a statement, TruAmerica CEO Robert Hart said the fund was oversubscribed after it set an initial goal of $400 million.

The fund will invest in workforce housing complexes across a number of U.S. markets, including Seattle, Boston, and Sunbelt cities including Phoenix, Las Vegas, Atlanta, Raleigh and Orlando.

As a value-add firm, TruAmerica mostly buys Class B garden-style communities and renovates the properties.

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Workforce housing generally refers to apartment complexes with rents for tenants that make between 60 and 120 percent of the area’s median income.

TruAmerica opened up the fund in November of last year, according to filings with the U.S. Securities and Exchange Commission.

The firm already owns and operates more than 58,000 units across 16 states. Its biggest market is Florida, where it has 19 properties totaling 6,346 units. In the fourth quarter of this year, the firm bought properties in Washington, Tennessee and Arizona, according to its website.

In Los Angeles, TruAmerica owns a 395-unit complex in Warner Center in the San Fernando Valley and a 464-unit high-rise in Koreatown at Vermont Avenue and Wilshire Avenue. It sold four L.A.-area rental complexes totaling 862 units to Blackstone for $312 million in 2019.

The workforce housing sector “has continued to perform well” over the last ten years and “demonstrated its durability” during the pandemic, according to TruAmerica’s chief administrative officer, Mark Enfield.

The asset class has become an attractive investment choice for developers. Waterford Property Company has acquired 11 communities in the last year across Southern California, using $1.8 billion in tax-exempt bond financing from the California Statewide Communities Development Authority.