NEW YORK–(BUSINESS WIRE)–Atlantic Equity Partners, an impact-minded real estate private equity firm that invests in value-add hotels, today announced the launch of its new Fund II, which will deploy capital to acquire and sustainably redevelop hospitality real estate with a double-bottom-line approach. The new fund will target a fundraise of $150M+ from limited partners globally, with $25M in capital already committed.
Fund II seeks to capture the tremendous opportunity offered by the current macroeconomic backdrop of a cooling global economy, high interest rates, and softening commercial real estate valuations to continue investing in hotels and related properties, which was also the focus of the firm’s first fund. Atlantic Equity Partners plans to source exceptional properties in highly desirable markets under unique circumstances, acquiring them at an attractive discount and unlocking immediate upside through repositioning. Then, the firm will upgrade and decarbonize the properties to capitalize on growing consumer demand for engaging with businesses that have sustainable business practices.
“The launch of Fund II is a proud moment that builds on the momentum of our first fund, and it marks a major milestone for our larger impact vision to decarbonize the built environment in a range of assets far wider than hospitality alone,” said Jonathan Hoenig, Managing Partner & CEO of Atlantic Equity Partners. “The climate crisis requires an urgent response from investors, and addressing carbon in all types of man-made structures and settings will be essential to move the needle on climate goals that protect people and planet. These dynamics offer investors a unique opportunity to achieve both attractive returns and meaningful, positive impact.”
Atlantic Equity Partner’s double-bottom-line approach combines traditional hotel and commercial real estate value-add upgrades – such as improvements to branding and the physical properties’ appearance – with impact-focused retrofits that make the assets hyper-efficient, electrified, and fossil fuel independent. This impact-minded approach delivers both economic value and meaningful environmental benefits.
Savings from energy efficiency upgrades will directly improve the bottom line of fund assets in the near term. By retrofitting the properties with electrified systems and implementing on-site renewable energy generation, energy costs can usually be reduced by nearly 100% with a very short-term payback period, which is additionally supported by tax incentives, rebates, and grants. Further, as requirements for decarbonized real estate expand, the assets are expected to deliver increased investor return thanks to attractive exits.
Each of the assets in Fund II will have a required set of metrics to reduce environmental impact through systems and retrofitting improvements, along with a strict set of durable and verifiable impact and efficiency guidelines around facilities operations.
“We are convinced that early change-makers in the decarbonization of built environment assets will benefit from growing demand among consumers and policy makers to address climate change,” said Hoenig. “There will be a first mover advantage in this space for those who recognize the benefits of electrifying real estate operations. Investors who are forward-thinking about the inevitable impact of future policy change, related to carbon reduction in real estate and business operations, stand to benefit greatly.”
Atlantic Equity Partners has assembled a team of experts in the fields of architecture, building, and academia – all of whom are focused on the hospitality industry and decarbonizing the built environment. In addition to Hoenig, these include:
- Tim Brett, Partner & Director of Asset Management; formerly of Pyramid Hotel Group
- Justin Jabara, Special Advisor, Hospitality Management Partner; President of Meyer Jabara Hotels
- Brett Newcomb, Special Advisor, Technology and Travel; CEO of Trecco, a travel recommendation platform
- Bruce Becker, Special Advisor; President of Becker and Becker Associates, Inc., focused on sustainable design, planning, financing, and development of buildings to meet the social, economic, and environmental needs of communities
- Bethany Patten, Special Advisor; Director of Policy & Engagement and Senior Lecturer at the MIT Sloan Sustainability Initiative
About Atlantic Equity Partners
Atlantic Equity Partners is an impact-minded real estate private equity firm that invests in value-add hotels. The firm targets high-performing markets with a primary focus on affluent travelers who prefer properties that are leading the way in sophisticated design and top amenities, while minimizing negative environmental impact. Atlantic Equity Partners implements a sustainable and scalable model – retrofitting existing real estate with decarbonization and waste neutralization methods and enhancing design, management, and operations. Best-in-class technology allows the firm to benchmark, measure, and report verifiable decarbonization results for its investments. For more information, visit Atlantic Equity Partners’ website.
