Lahcen Knapp, chairman of the board of directors, Empira Group
Swiss investment and asset management firm Empira Group has launched its first US focused fund.
EMPIRA Residential Invest US focuses on US multi-family real estate in major Sun Belt cities and their neighbouring metropolitan areas in Arizona, Texas and Florida. It follows a develop-and-hold strategy.
The Sun Belt refers to the region in the US that stretches across the South and South-West.
Empira currently has investment options comprising over 5,000 residential units at various locations in this region.
Ready-to-build sites allow for construction of residential properties and the completed units are held in the portfolio for the long term. This allows the fund to generate attractive returns and regular distributions during the holding phase.
Lahcen Knapp, chairman of the Empira Group board of directors, said: “The new ERI US fund provides our investors with attractive investment opportunities at significantly higher returns than multifamily properties in Europe and Germany. At the same time, the risk profile is lower due to positive fundamental growth factors in the US.”
The firm linked the launch of this fund with the rapid US population growth, especially in these ‘Sun Belt’ areas.
Mr Knapp said : “Since the pandemic began, California has lost 367,000 residents while Florida has gained 221,000. These trends are driving strong, sustained demand for real estate”
This growth has resulted in a surge in rents, exceeding 20 percent compared to the previous year in most of Empira’s target markets.
Mr Knapp also noted there is a clear trend towards rental apartments in the US.
“The US multifamily sector has generated strong returns in recent years and shown itself to be robust even through economic downturns like during the coronavirus pandemic,”
The investment volume is expected to amount to $600 million at an annual return of 13.5 percent (IRR).
This fund will also be in accordance with Article 8 of the EU’s sustainable finance disclosure regulation aimed at institutional investors.