East Chop Capital Closes $11M Fund for Luxury Vacation Rental Homes

East Chop Capital, a New York based real estate private equity firm focused on luxury vacation rental homes, announced the close of its sophomore fund at $11 million.

The firm closed its first fund in December 2020 at $4 million, with a focus on the $75 billion global vacation market. The firm noted that the market is expected to exceed $130 billion by 2033, citing data from Future Market Insights, Inc.

Our second real estate fund is focused on the luxury vacation rental home market. We target homes near lakes, beaches, mountains, and entertainment destinations, often within resort communities that guests love and have come to expect when they go on vacation,” Carrington M. Carter, co-founder and general partner, told Connect Money.

“We aim to build a diversified portfolio of strong cash flowing properties coupled with those expected to appreciate more quickly to hit our target 8% preferred return to investors, and the fund’s overall target return of 15%, net of fees,” continued Carrington.

Founded in 2018, East Chop, named after a residential area in the town of Oak Bluffs, MA, on Martha’s Vineyard, according to the firm’s website, has raised nearly $15 million to date.

With $30 million in assets under management, the firm also invests in technology, financial services, media, and professional sports. East Chop’s network includes about 200 investors, “90% of whom are black, and approximately 23% of whom are women,” the firm said.

“We often custom build or renovate homes to optimize living and entertaining spaces, with features like multiple game rooms, fitness centers, movie theaters, fire pits, etc. Our new flagship, 14,000 sq ft home opening in October, will have an indoor basketball court, indoor bowling alley, and a 1200 sq ft resort-style pool,” Carrington said.

The fund received equity investments from 93 limited partners, including Liberty Financial Services.