July 2009

Marcus Partners closes fund, targets D.C.

Marcus Partners plans to dip into its new $210 million fund to invest in the D.C. area.

The Boston-based real estate investment firm wants to target a mix of properties — including office, bio-medical, medical office, and light industrial properties — in metro areas east of the Mississippi River with Marcus Capital Partners Fund I.

Marcus Partners plans to invest $400 million into value-oriented real estate or related assets, shooting for individual deals in the range of $10 million to $130 million.

Institutional investors — which include pension plans and endowments — put up the bulk of the capital and smaller contributors include family offices and high-net-worth individuals. The fund took a little less than a year to raise, according to Kyle O’Connor, who will manage the fund and oversee the company’s investment activities in the D.C. and mid-Atlantic region. “You have to prepare yourself for capital commitments prior to getting to the point where interesting investments come up so that you can take advantage of them when the time is right,” he said. “The formation period precedes the investment period.”

He says the fund is actively pursuing investment opportunities in the D.C. area, with a concentration on office space, and has submitted investment offers in a variety of buildings that have come on the market. He notes that it may take some time before any deals close.   “In the long-term view we do believe in Washington as a marketplace but the investment markets are fairly anemic right now.”

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