Cresset Partners, a sponsor of non-traded alternative investment funds, has closed its first logistics fund and its second opportunity zone fund, and subsequently launched two follow-on funds.
Cresset’s first industrial-focused fund, the Cresset Real Estate Logistics Fund I, raised $250 million from accredited investors in 12 months to fund the development of nine warehouse facilities.
The company launched its second industrial fund, Cresset Real Estate Logistics Fund II, to meet tenant demand for logistics real estate, given the “ongoing supply chain disruption and the significant need for new and modernized industrial facilities in key U.S. markets.”
Cresset also closed its second opportunity zone fund, the $655 million Cresset-Diversified Qualified Opportunity Zone Fund II, and launched a third fund, Cresset-Diversified Qualified Opportunity Zone Fund III.
“We’re thrilled with the strong and continued interest investors have shown across our real estate portfolio,” said Michael L. Miller, co-founder and executive managing director at Cresset Real Estate Partners. “The successful closings of our logistics and opportunity zone funds, and the immediate launch of both follow-on funds, speaks to the diversified and exciting opportunities we see for core development in both sectors.”
He added, “Both strategies address the strong demand for investments in alternative asset classes that will help grow and protect our investors’ portfolios. Real estate can play a significant role in that allocation, especially amidst volatility in traditional equity and fixed income.”
Cresset’s first logistics fund launched in April 2021 and its developments span five cities, all in markets that are experiencing high population growth as well as strong regional distribution and busy port and logistics activity, the company said.
Cresset’s first opportunity zone fund launched in March 2018 and the second in March 2020. The funds raised a combined $1.1 billion in equity to develop 17 projects across the country totaling in excess of $4 billion in construction costs. The third opportunity zone fund is now open to investors.
Created by the Tax Cuts and Jobs Act in 2017, qualified opportunity zones offer investors the opportunity to receive substantial tax benefits in exchange for investing in designated distressed communities across the U.S.
Cresset said that the properties funded through its opportunity zone program have created more than 40,000 permanent and temporary jobs.
Jeff Cherner, co-founder of Cresset Real Estate Partners, noted that the first opportunity zone fund developments will be completed on time and on budget in 2022, and several will begin lease-up this year.
Cresset Partners is a private investment firm with more than $2.2 billion in commitments across real estate, private equity, private credit, and venture capital.