Fund Goal

To provide a superior rate of return, while limiting risk, through extensive diversification in real estate.

Who Can Invest

Sedgwick Real Estate Portfolio II (REP II) is closed to new investors.

Who Might Want to Invest

An investor who:

• • Wants to diversify a conservative portfolio by investing a portion of his or her money beyond the public securities markets and into real estate.
  • Wants the potential for superior long-term returns and is willing to assume a higher level of risk.
  • Can accept the inherent illiquidity.

SEP’s second real estate portfolio, Real Estate Portfolio II (“REP II”) was formed in May 2011. Most REP I investors are participating in this fund as well, thereby maintaining their allocation to real estate. The family has committed $5,000,000 to this fund.

The portfolio looks similar to REP I in that it contains two underlying investments:

TA Associates Realty Fund X

This well-known real estate firm was founded in 1982 and is based in Boston. We are participating in their tenth fund. TA follows a “value-added” strategy meaning they buy existing properties that are performing below expectations, fix them, and collect the income stream. TA also buys properties for capital appreciation. Interestingly, TA buys the first 50% of its real estate properties using a line of credit and then starts calling the capital committed by its investors.

Harrison Street Real Estate Partners III, L.P.

Sponsored by members of the Galvin family (founders of Motorola), this firm is a component of the Galvin family office. We are participating in Harrison Street’s third Fund. The real estate professionals running the fund have extensive experience, and their approach to business is very focused. Harrison Street specifically targets these areas: student and senior housing, self-storage facilities and medical office buildings, all in partnership with experienced local developers. Harrison Street has become an industry leader in these areas. With carefully selected locations, current demographic trends should ensure continued high demand for these projects. This “opportunistic” approach is a nice complement to the more traditional approach used by TA Associates.

Given the downturn in the real estate market, this investment seems to be well positioned in terms of its timing and potential for outstanding future performance.