At Capital Hedge via our FINTRX Platform, we’ve seen an uptick in family office investments across a wide variety of asset classes. Recently, the New York Equity Group closed its first real estate investment fund with $25 million in capital commitments led by family office Christmann & Gutermann, we’ve learned. NYEG, a recently formed venture led by real estate investor Philip Michael, intends to use proceeds from the fund-known as NYEG Fund I-to pursue its strategy of primarily investing in multifamily properties in secondary markets like Philadelphia, New Jersey and Baltimore, Michael remarked.
The firm expects to soon break ground on a 21-unit student housing development located near Temple University in Philadelphia that will look to cater to the area’s significant college student population. Michael, who worked as a director at commercial real estate news and events company Bisnow Media before venturing into real estate investment full-time, said the off-campus student housing project in Philadelphia will "Be marketed toward students and postgrads" in that city's bustling university scene.
"You can see high-rises and new development , but also the remnants of what used to be a really bad neighborhood." Michael added that NYEG is also looking at other sites in Philadelphia for similar multifamily projects.
The Christmann & Gutermann family office provided the majority of the $25 million comprising NYEG's first fund, which Michael said is mostly financed by European investors-including Danish soccer player Martin Braithwaite, a relative of Michael's.
The New York- and Switzerland-based family office is backed by the Gutermann family's textile industry fortune and currently has $6 billion in assets under management. Around $2 billion of that investment is focused on real estate, according to Steven Christmann, who leads the family office. Christmann said he was drawn to NYEG's focus on "second-tier markets with high growth rates," noting that the fund's approach falls in line with "The typical family office investment strategy [of] wealth preservation" while avoiding the "high barrier for entry" in primary markets like New York.
"I've been hearing for years now about the student housing market in Philadelphia and I know people who've made money there," Christmann said. "We're looking at emerging markets. We've been active in Denver and New Orleans, and we're looking at Philadelphia and Baltimore."
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