Rochester Economic Development, Inc. introduced a new $10 million community real estate fund at its annual meeting on Tuesday, February 22.
Before a packed house of 300 local business leaders, the president of RAEDI John Wade announced the creation of Rochester Area Real Estate Fund. RAEDI partners with Northfield-based company REVocitya Bounce Partners company, to launch and manage the fund.
Brett Reesethe founder and managing partner of Rebound Partners, explained that the real estate fund is to invest in projects in Rochester and Olmsted County to support residential, commercial, hotel and other developments to stimulate the local economy.
Referring to RAEDI’s Southeast Minnesota Investment Funds I and II that invest in start-ups, Reese said this project follows a similar path, but covers different ground.
“We are here to complement the Southeast Minnesota Investment Fund. They invest in business and we invest in real estate,” he said. It’s “impact investing”…investing in your community where you live and where you work.
Companies, organizations and individuals can invest in the fund with a minimum investment of $50,000.
President of REVocity Lori Bonin explained that the goal is to raise $10 million for the fund over the next 12 months, which could in turn be leveraged through local banks to generate more than $40 million in local investment.
REVocity and RAEDI will invest up to 5% of the total fund as general partners who manage it.
REVocity has launched 14 similar community funds throughout Northfield, Winona, Faribault, the Twin Cities and elsewhere.
Reese said the fund will benefit the community by meeting needs such as housing for the elderly or job-creating industrial projects, while generating returns for investors.
“One of our areas of expertise is taking older buildings and using them for higher and better purposes,” he said, citing the example of a building in downtown another town where three people worked. REVocity acquired it, modernized it and now 25 people work and live in the building.
Jeff Kiger tracks business activity in Rochester and southeastern Minnesota every day in “Heard on the Street.” Send advice to
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