Nov 14 (Reuters) - Private equity firm KKR & Co LP, which has diversified into other alternative assets such as real estate, said on Wednesday it plans to develop housing in a fast-growing city in North Dakota buoyed by the state’s oil bonanza.
KKR said it had acquired, together with co-investors Pfeffer Capital and CP Realty, 164 acres of land overlooking the city of Williston. Terms of the deal were not disclosed, but a source briefed on the matter said the investment could reach $150 million.
Construction of up to 330 apartments is to begin in the spring of 2013, and lots are being developed for sales to homebuilders for the construction of 500 single-family, townhome, and duplex homes, KKR said.
“This is a long-term investment to support the structural needs of a growing community. Because of the energy boom, North Dakota has had an influx of new residents and our experience in the unconventional oil and gas business gives us confidence that this is not merely a temporary development,” Ralph Rosenberg, KKR`s global head of real estate said in a statement.
Home to the oil-rich Bakken formation, North Dakota has surpassed Alaska to became the second-largest oil producer in the United States behind Texas. High-paying jobs in the state’s oil and gas extraction industry have surged as a result.
KKR does not have a dedicated real estate fund as yet and makes property investments from its balance sheet, capital from its North American private equity fund and KKR Financial Holdings LLC, a publicly listed vehicle that it manages.