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Largest-Ever Kayne Anderson Fund Closes at $2.75B, Senior Housing a Target

Kayne Anderson Capital Advisers closed the largest fund in its history with plans to target senior housing along with medical office and student housing in its overall strategy.

The opportunistic equity fund closed at $2.75 billion in capital investments, surpassing the $2 billion target set by the firm and the $2.5 billion estimates previously reported by Senior Housing News and other outlets.

The fund, called KAREP VI, is the company’s sixth such opportunistic equity fund. It is substantially oversubscribed after strong support from current investors as well as significant interest from new investors.

Kayne Anderson Real Estate, the real estate arm of Kayne Anderson, plans to spend half of the fund on medical offices, according to an earlier report from the Wall Street Journal. That would leave the remaining capital available for student housing and senior housing.

“The combination of an aging U.S. population and accelerating enrollments indicate strong growth characteristics across each asset class,” said the statement.

When it comes to senior housing, Kayne Anderson plans to stick with the strategy that it knows best. That strategy revolves around relationships with operators such as Watermark Retirement and Discovery Senior Living.

“We have a handful of key operators that we work with, and we’re not looking to expand that stable much more into [this fund],” Managing Director Max Newland told SHN in <<insert month/year>>.

To date, Kayne Anderson’s investment in senior housing has netted more than 17,000 units. Of those units, 275 are at the Brooklyn Heights luxury senior living community in New York City.

Watermark operates the Brooklyn Heights highrise, which opened approximately 13 months ago after a $330 million redevelopment that turned the Leverich Towers Hotel into a luxury community.

“I have worked in some really nice, luxury communities,” said Rocco Bertini, executive director of The Watermark at Brooklyn Heights. “Hands down, this is [like] a five-star hotel.”

Beyond its operator relationships, Kayne cites its “unique” sourcing network and strong financing as reasons that it can deploy capital to build on its current portfolio.

That portfolio includes the 34 properties purchased from Welltower in August 2020 for approximately $1 billion; seven of which are senior housing properties in Florida, as reported by SHN.

Other private equity firms with track records in senior housing also have raised large funds recently. Last month, Harrison Street closed on a $2 billion fund and KKR closed on a $4.3 billion fund.

The post Largest-Ever Kayne Anderson Fund Closes at $2.75B, Senior Housing a Target appeared first on Senior Housing News.

Source: For the full article please visit Senior Housing News

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