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Spire Capital to launch fifth fund

Global investment manager Spire Capital is set to add to its suite of Real Estate Opportunity Capital (ROC) funds in late October, providing investors with access to the United States aged-care property sector.

The offering, the Spire USA ROC Seniors Housing Fund, will be run in conjunction with its partner, Bridge Investment Group Partners, and aims to tap investment opportunities involving a US ‘for rent’ senior housing aggregation and improvement strategy.

The announcement comes on the back of the news Spire Capital’s most recent product, the ROC III, which invests in a combination of for-lease multi-family apartment communities and commercial office properties and was introduced to the market in February, has raised $117 million from Australian investors.

Specifically, the ROC III fund invests in B class multi-family apartment communities and seniors housing via debt and equity.

The private equity funds aim to generate a net internal rate of return of 15 per cent to 20 per cent a year, while the private debt funds are looking to deliver a 10 per cent to 12 per cent net internal rate of return, with an income yield of 7 per cent to 8 per cent a year.

“The private rental sector is a thematic that we have invested in for over six years now as we have seen three major cohorts move to rental,” Spire Capital director Dale Holmes said.

“In the US, millennials, seniors and the immigrant population are increasingly renting on the back of financial, cultural and demographic dynamics.

“Subsequently, occupancy across the nation in the B class sector is 97 per cent, stabilised yields are 6 to 7 per cent, rent growth is currently 4 to 5 per cent and long-term five to seven-year fixed debt is available at 3 to 4 per cent.”

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