RLJ Development, a privately-held property fund manager controlled by Robert L.
RLJ Development, a privately-held property fund manager controlled by Robert L. Johnson, founder of Black Entertainment Television and owner of the Charlotte Bobcats basketball franchise, has completed the final closing of its third private equity real estate fund, the RLJ Real Estate Fund III, with USD1.2bn in equity commitments.
The fund has 16 institutional investors including public and corporate pension funds, financial institutions and a hospitality business. With leverage, the RLJ Fund III will have total purchasing power of nearly USD4bn.
The RLJ Fund III’s initial aim is to acquire and develop upscale service hotels with premium brands in urban markets or dense suburban locations in major metropolitan areas, and has expanded its approach to include mixed-use investments in target markets.
‘We are delighted with the overwhelming response from the institutions,’ says chairman and chief executive Robert Johnson. ‘GE, through the General Electric Pension Trust and General Electric Real Estate Equities, is one of our foundation investors. We now have over USD2.2bn in equity under management in our real estate platform.’
The firm’s president Thomas Baltimore adds: ‘Our mission is to deliver superior risk-adjusted returns for our investors with a highly focused investment strategy. The backdrop of a slowing economy and tighter credit should create attractive buying opportunities for our well capitalised firm.’
RLJ Development is the largest African-American hotel investment company in the US with 135 hotels valued at more than USD3bn. Together with the RLJ Urban Lodging Fund and RLJ Lodging Fund II, the group’s private equity real estate funds total more than USD3bn in assets.
The RLJ Companies provide strategic investment in a diverse portfolio of companies in the financial services, real estate, hospitality, professional sports, film production, gaming and recording sectors. The group also includes RolloverSystems, a provider of retirement planning services, RLJ Equity Partners, a private equity fund that invests in expansion capital and buyout opportunities in six industries, and RLJ Select Investments, a multistrategy fund of hedge funds, as well as a savings and loan institution and a credit card business.
The RLJ Fund was exclusively represented by Presidio Partners, a real estate investment bank with offices in San Francisco and Chicago that provides capital raising and advisory services to real estate fund sponsors, operators, real estate investment trust and other market participants and has raised more than USD9bn in private equity capital for its clients since its launch in June 2003.
