Houlihan Lokey Advises Arc70 Capital

Houlihan Lokey is pleased to announce the closing of Arc70 Fund IV, LP (“Arc70 Fund IV” or “Fund IV”), which was oversubscribed and closed at its hard cap of $820 million, surpassing its initial target of $750 million. Houlihan Lokey served as the exclusive placement agent for Arc70 Capital LLC (Arc70) in support of the fundraise.

Arc70 Fund IV received strong support from new and existing leading institutional investors, including insurance companies, consultants, family offices, and asset managers. Arc70’s previous fundraise closed in 2021 with $550 million in capital commitments. The closing of Fund IV raises Arc70’s total assets under management to more than $1.8 billion.

Arc70 is a Burlingame, California-based structured credit investor that takes a long-term approach to investing and working with stakeholders to finance the development of affordable housing. Arc70 has made more than $4.5 billion of affordable-housing-related investments. These investments have built or preserved more than 43,000 units of affordable housing across the country.

Denny Hou, Co-Founder of Arc70, said, “We are grateful for the strong support from new investors and are excited to expand our partnerships with existing ones. The closing of Fund IV allows us to preserve and create affordable housing at greater scale while generating compelling returns. We are pleased to continue growing our impact on the space.”

“The demand for affordable housing in the United States continues to outpace supply,” said Peter Purcell, Managing Director at Houlihan Lokey. “As institutional investors continue to seek attractive risk-adjusted returns, this unique strategy saw high demand due to the team’s performance and experience with its tax-advantaged, uncorrelated strategy within affordable housing. It was our pleasure to work with Arc70 to raise capital that will ultimately serve low-income families, seniors, and people with disabilities.”

“We look to partner with unique, differentiated strategies such as Arc70,” added Matt Swain, Managing Director at Houlihan Lokey. “Investor appetite is in high demand, as evidenced by this successful fundraise. Congratulations to the Arc70 team.”

"We are appreciative of the trust our investors have placed in us. At Arc70, we are dedicated to pursuing market opportunities that create positive change in underserved communities while consistently delivering exceptional portfolio performance for our investors,” said Adrian Garcia, Co-Founder of Arc70 Capital.

Houlihan Lokey served as the exclusive placement agent for this fundraise. This transaction underscores the firm’s expertise in advising on complex fundraising initiatives. Houlihan Lokey leveraged its deep market knowledge to identify strategic global investors interested in uncorrelated strategies, such as Arc70’s differentiated approach. The success of this fundraise, along with strong support from both new and existing investors, will enable Arc70 to continue preserving and creating affordable housing at scale while generating compelling returns.

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