Harbor Group raises $1.6bn for multifamily-focused credit fund 

A subsidiary of the Canada Pension Plan Investment Board committed more than $500m to the fund. 

Harbor Group International has secured approximately $1.6 billion for a new multifamily-focused credit fund, including a $585 million investment from CPPIB Credit Investments III, a subsidiary of the Canada Pension Plan Investment Board. 

The Multifamily Credit Fund will target US multifamily credit opportunities including senior mortgages, Freddie Mac K-series bonds, preferred equity and mezzanine debt investments, and investments in securitized multifamily mortgage products. It will be a part of the firm’s roughly $20 billion, of which more than 80 percent is composed of multifamily-related investments.   

Richard Litton, president at HGI, described the fund as “uniquely positioned” to build on HGI’s track record as an investor in multifamily credit strategies. “We also expect to benefit from the current rate environment as we seek to achieve positive returns for our investors,” he added. 

The commitment also strengthens HGI’s and CPP Investments’ relationship. In 2020, CPP Investments served as the lead investor in HGI’s multifamily whole loan platform, committing $110 million. In 2019, CPP Investments committed $180 million to HGI’s Freddie Mac Supplemental Loan program.  

Geoffrey Souter, managing director, head of real assets credit at CPP Investments, said multifamily credit investments are seen as “resilient assets that are well positioned to drive strong returns for the CPP Fund over the long term.”