Middleburg, a development and management firm, completed its initial closing on Workforce Housing Fund and will contribute a previously acquired property, Vesta Derby Oaks to the fund.

The firm will continue to raise capital and add other family office and high net worth investors to the fund, which is expandable to $75 million, giving Middleburg the capacity to invest in around $250 million of real estate.

The fund's strategy is to acquire and substantially rehabilitate physically or operationally distressed assets (major deferred maintenance, poor management, high vacancy etc.) of existing multifamily workforce housing in the Southeastern and Mid-Atlantic regions of the U.S. After renovations, the fund will own modern, updated communities at a basis significantly below replacement cost, allowing Middleburg to rent high-quality apartment homes at levels affordable to working families.

The fund's first acquisition is a $30 million renovation of Vesta Derby, which was 15 percent occupied at the time of purchase. Many of the buildings were abandoned, creating significant blight and crime risk for the neighborhood. In addition to introducing professional management and improved security,

"The lack of supply of quality rental housing affordable to working families and individuals has reached crisis levels. Our investments through the Fund not only provide high quality rental housing, but achieve strong returns for our partners, who appreciate the social impact of community building," said Chris Finlay, Middleburg’s Managing Partner. "Vesta Derby is a great template for how we can create real transformational impact in the community, with far-reaching benefits."

Middleburg has received construction financing from Key Bank for Vesta Derby.