NEW YORK—StepStone Real Estate, a private real estate investment firm affiliated with the StepStone Group, a global private markets firm, committed to invest up to $87.5 million in HRI Properties, a diversified real estate company based in New Orleans.
HRI Properties develops, acquires, owns and manages premium-branded and independent hotels, upscale apartments, and mixed-use properties in major urban U.S. markets. The investment will fund the continued expansion of HRI’s portfolio into growing, urban markets. StepStone’s commitment dovetails with prior rounds of growth capital funded by Almanac Realty Investors in 2014 and 2016. StepStone closed its latest fund, StepStone Real Estate Partners III (“SREP III”), in February, with $700 million in capital commitments, $1.1 billion including committed co-investment capital.
HRI specializes in urban in-fill projects and the adaptive reuse of historic buildings. Under the leadership of Tom Leonhard, CEO, HRI owns and operates a portfolio with over 3,000 hotel rooms, over 1,500 apartment units and over 165,000 sq. ft. of commercial space. HRI also provides third-party hotel and apartment management services through its subsidiaries HRI Lodging and HRI Management, to 13 hotels and 31 multifamily properties.
“The HRI investment provides us with diversified exposure to high quality assets in major urban markets,” said Brendan MacDonald, a Partner at StepStone Real Estate. “HRI’s management team, portfolio and track record are best in class, and we’re excited to participate in their ongoing growth.”
HRI and its affiliates have completed more than 82 large-scale projects in 12 states totaling more than $2 billion in project costs. Current projects under development include Hyatt Unbound in Nashville, TN; Homewood Suites in New Orleans; and an Aloft in Philadelphia.
Robert W. Baird & Co. served as financial advisor to HRI in the transaction.