Firms & Funds

Prescott Group’s first PE fund attracts big family office

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Anar Shah, Prescott Group, private equity, family office
Anar Shah, managing director at Prescott Group. Photo sourced from LinkedIn
  • Why this is important: Family offices are investing in real estate managers raising their first funds

Prescott Group, a real estate investment firm, is raising its first private equity fund, with a hard cap of $250 million.

Among its early investors is a $6 billion family office that committed $25 million to the fund, a source familiar with the fund said.

About 90 percent of the fund will be used to purchase small/midcap debt pools, restructure debt/equity and partnership restructures for all asset classes and select office/multifamily and retail acquisitions, the source said.

Ten percent of the fund will be used for development and redevelopment of assets with proximity to major employers like educational and healthcare companies and other corporates.

The firm to date has made two investments from the fund, the source said.

The fund will invest $3 million to $15 million and aim to produce an internal rate of return of 15 to 17 percent, the source said.

Prescott previously worked on one-off projects with institutional investors, the source said.

The firm in 2013 acquired the debt-servicing company Dyck O’Neal, which purchases, manages and services real estate loans, including first and second mortgages.

Prescott decided to take its 22-plus years of real estate experience and put it into a fund structure, the source said.

Prescott Group consists of Prescott Realty Group, the real estate operating platform, Dyck-O’Neal and Prescott Advisors, its investment platform.

Team additions

In October 2017 the firm added Anar Shah to its investor-relations management team to reach a broader base of capital.

Shah, previously with Citi, joined the team that included Jud Pankey, founder and chief executive, Vance Detwiler, president, and Richie Butler, senior managing director.

In addition to Pankey, Detwiler, Butler and Shah, the investment committee includes Steve Abney, chief financial officer, and Mary Resch, chief operating officer.

And in July the firm added Gerald Casey as managing director/head of acquisitions and underwriting.

Action Item: Read more on Prescott here https://bit.ly/2TbcLsi