Mixed market-rate and low-income urban infill housing. Projects as small as 120 units of rental housing or 75 of for-sale. Community retail, office and medical office developments or redevelopments. Not exactly the stuff of recent commercial real estate headlines dominated by huge this, luxury that and state-of-the-art something else. But if success in real estate comes from seeing, and seizing, opportunities that others don\u2019t, Phoenix Realty Group might be onto something. The two real estate private equity funds that PRG just closed with a total of $470 million from a passel of blue-chip institutional investors will be deployed primarily in projects like those described above, PRG president Keith Rosenthal told CPN today. Investors in the Metropolitan Workforce Housing Fund, focusing on the tri-state New York City area, and the Genesis Workforce Housing Fund II, focusing on the greater Los Angeles area, include New York State Common Retirement System, the New York City Employee Retirement System and TIAA-CREF Global Social and Community Investments. These two funds bring PRG\u2019s total urban fund capitalization to $750 million. That will be leveraged through debt financing and existing municipal incentives to create $3.5 billion in market-rate rental and for-sale housing, mixed-use properties, and commercial developments in urban and infill areas nationwide. And though the strategy behind these two funds might sound like it was born of the post-subprime era\u2019s lower expectations, Rosenthal said that not only is this a consistent approach by PRG, but that the process of recruiting investors started about 14 months ago. PRG defines \u201cworkforce housing,\u201d Rosenthal explained, as for-sale or rental housing that\u2019s affordable for people earning 80 to 200 percent of that area\u2019s median income, or as he puts it, \u201cthe broadest part of the market.\u201d \u201cThe fundamentals of that are made a little murky right now\u201d by the upheavals in the financial markets, he said, but PRG sees solid returns from bringing product to \u201cthe tremendous underserved middle.\u201d The one change in PRG\u2019s strategy, he told CPN, is that the emphasis will shift from new construction to existing buildings. Part of that will be looking for properties that can be bought for less than replacement cost, and another aspect is\u201ctransit-oriented development,\u201d which will take advantage, in part, of long-term upward trends in energy prices. Rosenthal told CPN that PRG\u2019s vertical integration, combining expertise on the financial side with experience in development, construction management and asset management, lets the company pull off projects of this type successfully. \u201cIt\u2019s not enough in our view to simply be a capital allocator.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Mixed market-rate and low-income urban infill housing. Projects as small as 120 units of rental housing or 75 of for-sale. Community retail, office and medical office developments or redevelopments. Not exactly the stuff of recent commercial real estate headlines dominated by huge this, luxury that and state-of-the-art something else. But if success in real estate…<\/p>\n","protected":false},"author":1314,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1003703998","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"acf":[],"yoast_head":"\n