Primestor Development, an L.A.-based developer, has closed the first half of a new fund that will focus on building multifamily and retail assets near public transit in California.
The firm has raised $165 million — $100 million from Belay Investment Group, $25 million from LGT Capital Partners and the rest from other investors, according to Primestor CEO Arturo Sneider and an announcement from the firm on Wednesday.
Much of the funding will finance projects in L.A., where the firm has several projects already entitled, Sneider said.
In Panorama City, the firm is planning to redevelop a 17-acre mall, which the firm bought from Macerich for $98 million in 2015, with residential and commercial space, plus a new hotel. In southeast L.A. County, Primestor already has approvals to build housing and retail on a 10-acre lawn at the Civic Center in Norwalk.
The company has not counted the city of L.A. out for development sites, but Sneider acknowledged buying would be more difficult, given the city’s new transfer taxes.
“Obviously you have to factor that into it, it’s affecting the kinds of properties that might end up transferring,” he said in an interview.
Primestor started raising equity for the new fund in November 2021. After interest rates rose last year, fundraising proved more challenging, as investors sat on the sidelines.
“It definitely added a little bit of diligence,” he said of the impacts rising rates have had.
The firm hopes to bring the fund up to $300 million in equity commitments and close by the end of this year.