Key Takeaways
- • University of Michigan Board of Regents approved a $30 million investment in Detroit Renaissance Real Estate Fund, marking a rare institutional commitment to a Detroit-based fund by the endowment.
- • Fortus Partners, cofounded in 2011 by Corey Hanker (U-M 1997 economics graduate) and Jordan Friedman, serves as the fund's general partner and targets undervalued single and multifamily properties across the Detroit metro area (Oakland, Macomb, and Wayne counties).
- • The Detroit Renaissance Real Estate Fund seeks to raise up to $100 million total for purchasing, renovating, and renting residential properties typically requiring two to three bedroom configurations with varying renovation needs.
- • Investment represents strategic response to a Free Press investigative series revealing that since 1998, the University of Michigan's $11.6 billion endowment had directed only $40 million to a single Detroit-based fund—signaling minimal prior commitment to local real estate opportunities.
- • Fortus Partners initiated discussions with university investment officials in December 2016, framing the opportunity as addressing real estate value in the institution's immediate geographic market.
Summary
The University of Michigan Board of Regents approved a $30 million investment in Detroit Renaissance Real Estate Fund on February 15, 2018, representing a significant institutional commitment to Detroit-based real estate development. The investment was approved without Board commentary during the meeting, according to university documents filed with the decision.
Detroit Renaissance Real Estate Fund operates as a regionally focused vehicle investing in single and multifamily residential properties throughout the Detroit metropolitan area. Fortus Partners, the fund's general partner, was established in 2011 by Corey Hanker and Jordan Friedman. Hanker holds a 1997 economics degree from the University of Michigan, creating a direct alumni connection to the institution making the investment. The fund's strategy centers on identifying undervalued properties—typically two to three bedroom residential units across Oakland, Macomb, and Wayne counties—that require varying degrees of renovation before rental deployment.
The $30 million commitment supports Fortus Partners' broader capital-raising goal of $100 million for the Detroit Renaissance vehicle. Hanker characterized the University of Michigan partnership as validation of "a great opportunity in its own backyard," according to statements made following Board approval. Initial contact between Fortus Partners and university investment officials occurred in December 2016, preceding the formal Board vote by more than one year. Notably, Hanker declined to disclose expected profit margins or management fee structures associated with the university's capital deployment.
The investment decision follows a Free Press investigative series published earlier in February 2018 documenting that the University of Michigan endowment—valued at $11.6 billion—had allocated only $40 million to Detroit-based funds since 1998, despite the institution's location in the state and region. In response to the series, university officials argued that Michigan-focused capital deployment occurs through multiple vehicles not necessarily domiciled within the state. This $30 million allocation appears positioned as a partial response to scrutiny regarding local investment commitments by the endowment.
Detroit Renaissance Real Estate Fund operates as a regionally focused vehicle investing in single and multifamily residential properties throughout the Detroit metropolitan area. Fortus Partners, the fund's general partner, was established in 2011 by Corey Hanker and Jordan Friedman. Hanker holds a 1997 economics degree from the University of Michigan, creating a direct alumni connection to the institution making the investment. The fund's strategy centers on identifying undervalued properties—typically two to three bedroom residential units across Oakland, Macomb, and Wayne counties—that require varying degrees of renovation before rental deployment.
The $30 million commitment supports Fortus Partners' broader capital-raising goal of $100 million for the Detroit Renaissance vehicle. Hanker characterized the University of Michigan partnership as validation of "a great opportunity in its own backyard," according to statements made following Board approval. Initial contact between Fortus Partners and university investment officials occurred in December 2016, preceding the formal Board vote by more than one year. Notably, Hanker declined to disclose expected profit margins or management fee structures associated with the university's capital deployment.
The investment decision follows a Free Press investigative series published earlier in February 2018 documenting that the University of Michigan endowment—valued at $11.6 billion—had allocated only $40 million to Detroit-based funds since 1998, despite the institution's location in the state and region. In response to the series, university officials argued that Michigan-focused capital deployment occurs through multiple vehicles not necessarily domiciled within the state. This $30 million allocation appears positioned as a partial response to scrutiny regarding local investment commitments by the endowment.
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