Strategic Investment Fund Partners completes first close of private offering

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Pittsburgh-based Strategic Investment Fund Partners (SIF) completed a first close at $34.1 million in a private offering from its existing investors and launched a new strategic focus for the fund.

SIF, a source of gap financing for catalytic real estate projects in southwestern Pennsylvania, invests in projects with the potential to revitalize communities across the region.

A newly adopted strategic plan now broadens SIF’s impact by supporting worthwhile projects around the Pittsburgh region that require a flexible source of capital to close their financing gaps.

Also, SIF has retained the Regional Industrial Development Corporation of Southwestern PA (RIDC) to manage the fund, identify projects, perform underwriting, recommend investments to the SIF board and provide oversight of investments. RIDC has also agreed to invest 10 percent of the amount ultimately raised, up to $5 million.

This private sector initiative, founded by the Allegheny Conference on Community Development (ACCD), has previously supported 67 projects with $171.2 million in financing. Going forward, SIF will adopt a more deliberate regional strategy to include worthwhile projects in a 12-county region. The Allegheny Conference will continue to be the point of contact for investors and general administrative support.

The fund intends to complete its fundraising by the end of this year. The current fund’s investors, or limited partners, for the initial close includes 20 corporations and foundations.

“SIF investors are stepping forward to provide critical financing for catalytic projects that can transform communities,” SIF Board Chair David Malone, chairman and CEO of Gateway Financial Group, said. “Building on a foundation that has had a meaningful impact downtown and in other neighborhoods, SIF is now moving ahead, leveraging the experience of RIDC, and planning to provide support for catalytic projects across the Pittsburgh region.”

The gap financing that SIF provides is designed to bring projects to fruition that would be unable to move forward without the additional investment from SIF. However, the projects must be aligned with one of the following strategic criteria:

• Regional Cores Investment Strategy: Support regional downtowns by maintaining quality office space, converting vacant buildings, and investing in desirable amenities for workers, residents and visitors.
• Research & Development Led Industry Strategy: Develop properties integral for the growth of research and development driven companies.
• Strategic Site Acquisition Strategy: Provide purchasing power when certain projects advance SIF’s goals and other strategies.
• Innovation Strategy: Remain flexible and responsive to projects that further SIF’s mission and objectives as the regional economy evolves and new opportunities present themselves.

“Southwestern Pennsylvania is a regional economy and projects across the region can have a region-wide catalytic effect, attracting businesses and creating jobs for our communities. SIF’s new regional strategy is an important tool for bringing projects to reality and building economic momentum,” RIDC President Donald Smith, Jr. said.