Covenant Capital Group, a value-add multifamily real estate investment firm based in Nashville, said it has reached the final close of Covenant Apartment Fund XII, L.P. with $860.35 million in capital commitments, marking the largest fundraise in the firm’s 25-year history.
Alongside Fund XII, the firm formed a sidecar vehicle, the Covenant Affordable Housing Fund, with $269.73 million in committed capital. Combined, Covenant said the two vehicles raised more than $1.1 billion in total capital for the 12th fund in its flagship value-add series and its affordable housing-focused sidecar.
Covenant attributed the fundraising outcome to strong interest from both existing and new institutional partners, which it said reflects conviction in the firm’s value-creation approach and performance history across market cycles.
The firm said Fund XII is designed to pursue underperforming multifamily properties with clear value-add potential, targeting assets where renovations, operational improvements, and disciplined asset management can enhance performance. Covenant said its strategy is focused on preserving apartment communities in fast-growing Sunbelt markets amid what it described as a national shortage of middle-market apartments.
Covenant also positioned its new affordable housing sidecar as a preservation-focused vehicle intended to address the shortage of affordable housing by investing in existing affordable housing locations across the United States.
Covenant said it currently oversees more than $2.4 billion in assets under management across more than 22,000 multifamily units and has acquired more than $5 billion in multifamily assets nationwide since inception. The firm added that Fund XII has already committed $240 million to 14 apartment communities across the Sunbelt, while the Affordable Housing fund has committed $94 million across 40 projects throughout the United States.
Founded in 2001, Covenant specializes in value-add multifamily investments across the Sun Belt and has invested in more than 73,000 apartment units to date, with a focus on targeted renovations, operational efficiencies, and resident-centric improvements.
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“We are looking forward to implementing our time-tested investment strategy of making value-add investments to preserve apartment communities across the rapidly growing Sunbelt. The United States continues to have a shortage of middle-market apartments and Covenant Capital Group intends to provide an attractive solution for renters along with top tier returns for investors. In addition, we are delighted to offer our Fund XII investors the opportunity to invest in Affordable Housing through our new sidecar vehicle. This fund will directly address the shortage of affordable housing in the country by preserving existing affordable housing locations across the United States.”
Govan White, President And Co-Founder, Covenant Capital Group
“Investor demand for Fund XII highlights the confidence in Covenant’s ability to execute in all market cycles. With more than two decades of experience in value-add multifamily and a deep bench of operational talent, we believe we are well-positioned to acquire assets that require hands-on repositioning and active management—an area where our platform has excelled.”
Dan Barber, Managing Director And Chief Financial Officer, Covenant Capital Group
