2 Firms Form Acquisition Fund

Real estate services firm Kennedy-Wilson Inc. of Beverly Hills and Los Angeles-based Hanover Financial Co., a subsidiary of real estate investment brokerage Marcus & Millichap, have created a $200-million fund to acquire apartment and condominium properties throughout Southern California.

The companies said rising rents, growing demand for housing and a lack of new construction translate into “excellent investment opportunities” to acquire undervalued properties and boost their value by renovating and improving them.

“We have been tracking this opportunity for some time, and Southern California’s multifamily market is well positioned for investment and growth,” said Lew Halpert, president of Kennedy-Wilson International’s Residential Group.

The companies said the joint venture has purchased a 95-unit condominium complex in Beverly Hills and a 100-unit apartment building in Reseda that are representative of the kinds of properties they are seeking. The partnership bought both for a total of about $20 million.

Kennedy-Wilson and Hanover are the latest in a group of investment ventures that have been formed in recent years to capitalize on the Southland’s apartment market, in which property values have risen substantially since the recession ended. Often, such groups acquire properties they can renovate to boost their value.