Neyer Properties is launching its fourth and largest private equity fund to date. The company is well on its way to raising $50 million from private investors to continue the purchase and redevelopment of key real estate assets, says Dan Neyer of Neyer Properties.
Since 2009, Neyer has acquired over 4 million square feet of buildings valued at over $170 million in the Cincinnati, Columbus, Northern Kentucky, and Indianapolis regions. “This additional equity will give enough purchasing power to acquire more than $150 million worth of assets in Fund IV”, said Neyer.
Neyer’s first and second fund were established in 2010 and 2011, respectively. The third fund, which closed in May 2013 raised $23 million and was fully invested by late 2014. Some of the acquisitions for Fund III included the two Baldwin buildings along I-71 and four office buildings near the center of Blue Ash. Neyer is looking into various redevelopment options for the historic Baldwin building which was the original manufacturing facility for Baldwin pianos. The building was later converted into office space in the 1980’s.
Neyer’s investment criteria is to acquire medical office, office, industrial, and retail buildings within 200 miles of Cincinnati. “We buy the “cracked” but not broken buildings,” said Neyer, “where we can utilize our overall platform including conceptual design, construction management, repositioning of the assets, marketing and leasing to achieve excellent returns to our investors.”
“One of our key items is to be able to see things that others do not see such as the transformation of the buildings to different uses and providing the necessary capital to improve the assets to become more attractive to tenants.”
As with all properties in Neyer’s current portfolio, the company is looking for assets that will provide long-term appreciation and offer a significant discount to its replacement value. “Having good access, especially to a major highway, and buying at the right basis where value can be obtained is key,” said Neyer. Typical investments by Neyer range from $3 million and $30 million per property.
Neyer recently sold the 1.1 million square foot Gateway 75 warehouse that was purchased within Fund I to Gorilla Glue for $23.3 million.
The investment funds are a complement to Neyer Properties’ design and build, property development and finance arms.