Beacon Capital Raises $1.58B for New Fund, Includes Acquisition of Asset in San Jose

Affordable Housing, Irvine Community Land Trust, Irvine, California Assembly

By Jon Peterson

Boston-based Beacon Capital Partners has concluded a $1.58 billion capital raise for its latest commingled fund known as Beacon Capital Strategic Partners 8. The real estate manager did confirm through an email that one of the first four properties acquired for the fund was a building in San Jose.

Beacon had paid $101.5 million for the acquisition of the 298,464 square foot office building located at 160 West Santa Clara Street. The fund manager had purchased the property in April 2018. The locations of the other three properties already in the fund are Glendale, Calif., Chicago and Washington, D.C.

The capital raise by Beacon went up a little higher than its original target of $1.25 billion. There is some additional capital that will be invested alongside of the fund, which is comprised of $220 million of initial investor-approved co-investment equity.

“We are grateful for the continued support from our existing investor base, and we are pleased to welcome a number of new partners. The first four assets present meaningful opportunities for us to leverage our deep experience and robust operating platform on behalf of our investors,” says Fred Seigel, president and chief operating officer of Beacon in a prepared statement.

Beacon was able to attract a mixture of domestic and foreign investors into the commingled fund. Among the most significant investors are the California State Teachers Retirement System with a $300 million commitment and $100 million from the State of Wisconsin Investment Board, according to information received from both investors.

Beacon 8 is considered to be a value-add fund. The manager is anticipating acquisitions of office buildings in major markets nationwide where it looks to transform them through capital improvements and leasing. The San Francisco Bay Area and Seattle are likely two markets where the manger will be active for the fund going forward. Beacon does have a regional office in San Francisco at One Sansome Street.

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