Cresset Partners, a sponsor of non-traded alternative investment funds, announced the formation of a joint venture with Level 2 Development and SJG Properties to develop The Ace Apartments, a new mid-rise residential building in the Scott’s Addition opportunity zone in Richmond, Virginia.
This will be the first project in Cresset’s third qualified opportunity zone fund, Cresset Diversified QOZ Fund III.
The company says the groundbreaking is expected in the third quarter of 2023. The Ace offers access to the Richmond employment base, Interstates 195, 64, and 95, as well as West Broad Street, an east-west main road serving Richmond and the surrounding area.
Just three miles from downtown Richmond, the 1.7-acre, $98 million project is proximate to multiple retail and entertainment amenities and will feature 295 luxury studios, one-, and two-bedroom apartments, averaging 753 square feet per unit. The units will include various finishes including stainless steel appliances, quartz countertops, and large, sunlit windows, as well as balconies in 85% of the units.
Additionally, Cresset says the development will include a 7,500-square-foot courtyard, a 4,500-square-foot clubroom, and a swimming pool, among other amenities. The project will also include over 13,000 square feet of ground-floor commercial space.
“We are excited to partner with Cresset Partners in our Scott’s Addition Project,” said Ashley Wiltshire of SJG Properties. “Cresset’s experience in opportunity zone projects and their long-term investment strategy made them a natural choice as a partner in developing The Ace. Cresset’s inclusion in our joint venture made a strong team even stronger.”
The Ace is located within a ten-minute walk to the Diamond District, a $2.4 billion redevelopment project that will center around the new home stadium for the Richmond Flying Squirrels, the local Minor League Baseball team and Double-A affiliate of the San Francisco Giants. Once completed, the development will include an 11-acre greenway, housing, offices, hotels and a concert venue.
“The Richmond Metro Area has been the fastest growing metropolitan region in Virginia since 2020 and shows no signs of slowing its development yet,” said Jason Ross, director at Cresset Partners. “We’re very excited to support that growth by partnering with Level 2 and SJG on The Ace Apartments project. We’re thrilled by the strong investor interest so far in Fund III and look forward to continuing to deploy that capital into strategic, top-quality projects like The Ace over the coming months.”
The partnership marks the first investment from Fund III, which launched in June 2022 following the success of its $655 million predecessor, Cresset Diversified Qualified Opportunity Zone Fund II. In total, Cresset Partners has committed $1.2 billion in equity to QOZ projects covering more than six million in square footage.
Cresset Partners is a private investment firm with more than $3 billion in commitments across real estate, private equity, private credit, and venture capital.