By Jon Peterson
San Francisco-based Rubicon Point Partners is now out in the market raising capital for its commingled fund known as Rubicon First Ascent. The targeted capital raise is $250 million with a hard cap of $350 million, according to a board meeting document from the Pennsylvania State Employees Retirement System.
Rubicon Point Partners did not respond to emails seeking comment for this story.
The commingled fund will be investing in assets in both the San Francisco Bay Area and the Pacific Northwest. It will be focused on buying office buildings and mixed-use properties in those markets, although the commingled fund is only allowed to have 25 percent or less of the fund allocated to assets in the Pacific Northwest.
The board meeting document stated that for Pennsylvania State Employees the capital raise for the commingled fund is projected to be completed during the first quarter of next year. The commitment for the pension fund totals $50 million. This will be split up with $30 million to be placed directly into the fund and another $20 million for the Rubicon First Ascent Sidecar for co-investment opportunities with the commingled fund.
Rubicon will be looking at value-add middle-market sized transactions. These will typically be in the range of $15 million to $50 million. This is a segment of the investment market that has shown to be less efficient due to lesser competition from institutional investors. Most of the transactions for the fund will be with existing assets. No more than 10 percent of the aggregate commitments to the fund can be invested in ground-up development projects.
Rubicon First Accent will be the first commingled fund for the San Francisco firm. The real estate manager has been an active investor for many years through separate accounts with several institutional investors. One of these has been the California Public Employees Retirement System (CalPERS) as part of the pension fund’s emerging manager program.
Since the company was formed in 2011, it has acquired $910 million in real estate. Rubicon has shown a strong investment performance since that time, generating a 37 percent internal rate of return and a 1.7 multiple on invested capital. The assets that the company has acquired total 25 properties covering 2.7 million square feet.