Fifth Wall, a venture capital firm whose primary focus is proptech, recently announced it closed its second real estate technology fund—Fund II. This recent round of funding collected $503 million—twice the amount of the company’s initial fund, which closed in May 2017. Fifth Wall raised capital for Fund II from a number of influential owners, operators and real estate developers around the world. These investors represent some of the most sought-after customers and partners for the entrepreneurs and startups that Fifth Wall invests in, according to the company. Putting so many CRE owners into a single fund allows Fifth Wall’s unique investment model to help large real estate companies access innovative new technologies that can transform their businesses.
While Fifth Wall’s initial fund was raised from nine strategic U.S. real estate investors, Fund II attracted global interest from more than 50 corporate strategic investors from 11 countries, which brought the company’s total assets under management to more than $1 billion. Gecina (France), MERLIN Properties (Spain) SERGO (UK), Kenedix and Mitsubishi Estate (Japan) and Keppel Corporation (Singapore) were among the international Fund II investors. Meanwhile, CBRE, Cushman & Wakefield, D.R Horton, Equity Residential, Toll Brothers and Starwood Capital comprised some of the funds’ U.S. investors.
“As the real estate and technology industries increasingly converge, Fifth Wall has become central to that convergence, fostering a level of strategic collaboration that has never before characterized the real estate industry,” Fifth Wall Co-Founder and Managing Partner Brendan Wallace said in a statement. “Fifth Wall sees powerful network effects in our unique fund model as it becomes a centralized platform for the world’s largest real estate companies to share insights and access new technologies to enhance their businesses. For our entrepreneurs, Fifth Wall efficiently opens distribution channels for their products to more than 50 corporate strategic investors globally and we have dedicated a team to support the success of those partnerships and integrations.”
“We’re committed to identifying and partnering with organizations that can help us develop the next generation of technology solutions for our clients, our colleagues, and the built environment,” Cushman & Wakefield Executive Chairman and Chief Executive Officer Brett White said in a statement. “We believe we’ve found a great partner and advisor in Fifth Wall, and together, we can help put Cushman & Wakefield’s clients at the center of some of the most innovative technology solutions in our industry.”
Fund II is currently the largest active venture capital fund in the Los Angeles area and it’s grown from eight employees at the time of its initial fund closed to more than 30 employees to date.
“Los Angeles is an economic capital — a place where businesses put down roots and quickly become very successful,” Los Angeles Mayor Eric Garcetti said. “Companies like Fifth Wall have powered our economy to new heights, and their successful launch of a new fund is the latest reminder that businesses in Los Angeles don’t just mark history — they make history.”
Fifth Wall’s nine-person strategic consulting team helps its real estate investors address the strategic and operational challenges of new technology adoption and structure partnerships, integrations, contracts, and distribution deals. The team works closely with its corporate strategic investors to support Fifth Wall’s investments in companies like Opendoor, Lime, Hippo, VTS, and Industrious.
“We’re constantly looking for new real estate services and technologies to improve the way we develop and manage our residential and commercial properties in France,” Gecina Chief Executive Officer Meka Brunel said. “We partnered with Fifth Wall to help us anticipate what’s ahead, and connect us with ideal partners and technologies so we can deliver the best solutions for our customers.”