Proterra expands into real estate and makes senior hire

Managing partner Rich Gammill says the Cargill spin-out’s experience in ag-focused real assets and credit will shape its approach to finding good assets with bad balance sheets within US real estate markets.

Proterra Investment Partners has hired a chief executive from New York Stock Exchange-listed REIT Centerspace to lead an expansion into real estate investment.

The Minneapolis-headquartered food and agribusiness-focused firm has hired Mark O Decker to serve as a founding partner at Proterra Real Estate Partners. Decker is based in Minnesota for the role.

Proterra managing partner Rich Gammill told Agri Investor he and Decker have invested together personally to build residential buildings in the area that will now form part of the asset base for the new company. Proterra’s experience in managing ag-focused real assets and credit investments will be applicable to real estate in a macro environment that has left many good assets with bad balance sheets, he added.

“Because we’re not there today, we don’t have a bunch of legacy issues and challenges, but we have a lot of experience and knowledge,” said Gammill, who leads Proterra’s credit investment strategy and co-heads its food investments. “With Mark’s expertise, I think we can offer to investors an interesting take and an opportunity to invest in a space that has some real challenges, but also real opportunities for us to pursue.”

Proterra Real Estate Partners will focus primarily on US multifamily real estate investments, Gammill said. In the statement announcing the unit, Proterra described Decker’s experience at Centerspace as culminating in a stint as chief executive that focused on a “substantial reposition” of the company from a diversified real estate company to a focused operator of apartments.

According to his LinkedIn profile, Decker held positions at BMO Capital Markets, financial services firm Robert W Baird & Co and elsewhere before his six years at North Dakota-headquartered Centerspace.

Gammill said Proterra Real Estate Partners will solicit investments from a similar mix of investor types as its ag units that include public and private pensions, sovereign wealth funds, endowments and others. He declined to disclose the size of vehicle Proterra Real Estate Partners will seek to raise.

“The real estate industry is full of very, very large players. We are a very large player in the food and ag vertical and intend to get bigger. There are good things happening there too,” he said. “This is just an opportunity in an adjacent space that we can offer an interesting play on.”

Proterra manages more than $4 billion in investments that also include mining from offices in Minneapolis, London, Sao Paulo, Singapore, Shanghai and Sydney. Its investors include Cargill (from which Proterra spun out), the Teachers’ Retirement System of the State of Illinois and the Ohio Police and Fire Pension Fund, among others. In November 2021, it reached a first close on $150 million for the second iteration of its credit-focused vehicle, for which it is seeking $500 million.

Gammill highlighted the complimentary nature of the asset management practices that tie its agricultural investment strategies to the expansion into real estate. He added that the decision to expand outside of food and ag at this time does not reflect a judgment there are not attractive opportunities in the market.

“We remain super bullish with what’s happened over the past 24 months with commodity cycle and returns we are generating in our farmland strategies, agribusiness strategies and credit,” he added. “This [expansion into real estate] is actually a very adjacent market that makes sense, it’s not a leap into something totally different.”