Latest news with #MultifamilyDive
Yahoo
2 days ago
- Business
- Yahoo
Why BH Properties created new multifamily platform Haven Housing
This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Two years ago, Los Angeles-based BH Properties announced its intention to build a $1 billion portfolio of affordable housing assets. 'That early commitment enabled us to build key relationships, gain deeper insight into market dynamics and refine our deployment strategy,' Jim Brooks, president of BH Properties, told Multifamily Dive. Last month, the real estate investment firm continued its growth in the apartment space by forming Haven Housing, a new multifamily investment platform focused on acquiring, enhancing and operating market-rate and affordable housing communities throughout the Western United States, according to a news release. Haven Housing is seeded with 2,500 units, targeting A- and B-class properties in Texas, Arizona, Nevada, Oregon, Washington, Colorado and Utah. It will seek 100-plus-unit garden-style communities with value-add potential, particularly in high-barrier, high-demand metropolitan areas, according to Brooks. On the affordable side, Haven will purchase income-restricted communities past their 15-year low-income housing tax credit compliance periods, with an emphasis on preserving affordability and improving performance through renovations and operational upgrades. 'They might be seven to eight years out from expiration [from LIHTC], which gives you some optionality,' Brooks said. 'That was one focus of the effort. It's not exclusively the focus of the effort, but it's one focus of the effort.' BH Properties, which has carved out a niche in industrial, office and retail sectors over the past 31 years, recently brought Connor Mortland aboard as managing director and head of affordable housing acquisitions. Mortland will lead the platform's affordable investment strategy from the firm's San Diego office. 'We spent some time evaluating the affordable space and came to the conclusion it was a good sector to enter,' Brooks said. 'There's not a lot of institutional capital in the affordable space. There are benefits to affordable versus market rate, including low turnover and being less capital intensive.' Here, Brooks talks with Multifamily Dive about Haven's goals, distressed opportunities and the transaction environment. This interview has been edited for brevity and clarity. MULTIFAMILY DIVE: How many properties would you like to add under the Haven Housing banner? JIM BROOKS: If you look at the overall five-year plan for multifamily, which encompasses affordable, we'd like to grow that to $1 billion over five years. In terms of growth goals and, secondarily, markets, affordability is much easier to manage if you have the right managers in those regional markets, from Texas to the Pacific Northwest and down into parts of California. On the affordable side, we would look beyond those borders for the right opportunity. You will likely not see us in the Northeast. You will likely not see us in the extreme Southeast, given insurance concerns, operating expenses and similar factors. But you likely would see us expand outside of Texas into the Midwestern states, only because of the ease of management. You're looking at affordable housing, yet you've also listed class A properties as a potential target. How would those properties fit? You're seeing some stress in the market-rate world today. Post-pandemic rates were low, and developers had big, rosy pro formas. So you're seeing some markets — Austin is one and Phoenix is one — where you had overbuilding. For those new deals coming up now, we would absolutely look at those. How do you aim to maintain affordability with market-rate properties? Many companies had ambitious, rosy projections for value-add apartment acquisitions before and after the pandemic. And they were financing that with very cheap debt. In a lot of cases, that very cheap debt has become very expensive debt today, which turns those models upside down. It was an easy business to get into, and it was capital gain-restrictive. Now, there was also an overbuilding of market rate, and they don't have many options. So, if we can acquire those properties at a discount or at levels comparable to the maturity debt, and then reinvest in them, that's one alternative. But you have to be smart about it. Do you see the opportunity to buy distressed properties? There are certainly markets where you see that. You're starting to see that in the greater Phoenix metro in Arizona. You're starting to see a little bit of that in Austin — markets where you had this huge supply. You've seen it absolutely slow down. You can look at new stock. Supply has been shut off. You've got deliveries still occurring. If you can buy those right and you don't have new supply over the next three to five years, there is a window there. You start to get ahead of the curve in some of these markets before supply starts back up again. And it certainly will at some point. Will the transaction market pick up in the second half of the year? If you asked me this question in January or February, I'd say it looked pretty good. We're dealing with tariffs and elevated interest rates, with few projected interest rate cuts. So there is a high cost of capital. Things have gotten slower on the capital market side. I think that will correct itself over time. However, we're different from a lot of companies. We don't have third-party capital, we don't have limited partners and we don't have a lot of bureaucracy. We're very entrepreneurial in how we structure deals. So when institutional capital is largely on the sidelines as it navigates this political stress, that window is open for companies like ours. Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Hines, Sumitomo partner on waterfront apartments near DC
This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Property: Potomac Shores multifamily development Developers: Hines, Sumitomo Forestry, Chuo-Nittochi Group Architect: Lessard Design Inc. Location: Dumfries, Virginia Units: 365 Cost: Withheld Houston-based developer Hines is joining forces with two Japanese real estate groups — Sumitomo Forestry and Chuo-Nittochi Group — to add a 365-unit apartment project to the Potomac Shores master-planned community south of Washington, D.C., in Dumfries, Virginia. The partnership recently closed on the development site, located one block from a future Virginia Railway Express train station, and expects to start construction in late July. The as-yet-unnamed project is set to be completed in 2027. The five-story wood-frame building will include a mix of studio and one-, two- and three-bedroom units, along with 31,000 square feet of indoor and outdoor community spaces. Amenities will include a coworking lounge, a children's play area, a pool and cabanas, a fitness center, a rooftop lounge and outdoor recreation areas. Bethesda, Maryland-based Coakley & Williams Construction is the project's general contractor. The 2,000-acre Potomac Shores community, developed by New York City-based Biddle Real Estate Ventures, is located along 2 miles of the Potomac River shoreline. The upcoming multifamily project will be the only one of its kind in Potomac Shores, joining single-family home developments by Ryan Homes and Stanley Martin Homes, both based in Reston, Virginia, and Fort Mitchell, Kentucky-based Drees Homes, according to the property website. 'This water- and transit-oriented multifamily development is uniquely positioned as the only rental community within an already established mixed-use master-planned community,' said Andrew McGeorge, senior managing director at Hines, in the release. 'With minimal multifamily construction expected in 2025, the market has a heightened demand for high-quality, newly constructed apartment homes like this one.' The Hines project will be located near the Potomac Shores town center, which includes over 3.7 million square feet of commercial and retail space. The property also encompasses 850 acres of open space, a trail network in progress, a newly renovated golf course and elementary, middle and high schools. The Potomac Shores rail station is expected to be completed in late 2026, providing access to Washington, D.C.; Quantico, Virginia; and Arlington, Virginia. Recommended Reading JPI-Sumitomo deal closes Sign in to access your portfolio
Yahoo
5 days ago
- Business
- Yahoo
Apartment deal flow falls 14% in Q2
This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Dive Brief: Apartment sales volume fell 14% year over year to $35.1 billion in the second quarter, according to a report that data firm MSCI Real Assets shared with Multifamily Dive. However, they rose 5% to $66.6 billion in the first half of the year. Unlike the Q2 2024, no major entity-level deals closed in 2025. Last year, New York City-based investment manager Blackstone took Denver-based Apartment Income REIT Corp. private for approximately $10 billion, which drove transaction volume. The Real Capital Analytics commercial property price indexes ticked up 0.1%, according to MSCI. Cap rates have remained flat at 5.7% over the past year. Dive Insight: In its monthly report, MSCI acknowledged that the headline sales numbers for 2025 appear unfavorable. But if you dig a little deeper, things are more promising. 'The reality, though, is that the market is still the largest, most liquid component of the commercial real estate market in the U.S., with deal volume just below pre-pandemic levels,' MSCI said in the report. 'The decline for the quarter was an artifact of one big deal in the same quarter last year.' Individual asset sales, often considered the bedrock of multifamily transactions, rose 15% YOY in Q2 to $28 billion. In the five years before the pandemic, apartment trades averaged $29 billion in Q2. In the six major metropolitan areas of Boston; New York City; Washington, D.C.; Los Angeles; San Francisco; and Chicago, individual sales increased 6% to $6.7 billion in Q2. In the non-major metros, activity for these deals increased 18% YOY in the quarter on sales of $21.3 billion. Portfolio sales fell 57% to $7.1 billion in Q2. No portfolio was traded for more than $1 billion, with the six largest priced at more than $400 million. Apartment investors say the transaction market slowed noticeably after President Donald Trump's tariff announcements in April. 'We're dealing with tariffs,' Jim Brooks, president of Los Angeles-based real estate investor BH Properties, told Multifamily Dive. 'We're dealing with elevated interest rates, and not a lot of cuts are projected. So there is a high cost of capital. Things have gotten slower on the capital market side.' However, Brooks remains hopeful that things will pick up for his firm, partially because institutional investors are still not fully back in the market. 'We're optimistic, just given the way we're capitalized and the way we can operate,' Brooks said. 'Privately capitalized investment groups should have their moment in the sun before institutional capital comes flooding back in.' Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
23-07-2025
- Business
- Yahoo
Multifamily starts spike for 5-plus units in June
This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Dive Brief: Starts for buildings with five or more units jumped 30.6% month over month in June and rose 25.8% year over year to a seasonally adjusted rate of 414,000, according to a monthly report from HUD and the U.S. Census Bureau. Overall housing starts came in at a seasonally adjusted annual rate of 1.3 million in June — a 0.5% decrease YOY and a 4.6% increase compared to the revised May estimate. Single-family home starts clocked in at a rate of 883,000 homes, a 10% YOY fall and a 4.6% month-over-month decline. Apartment developers pulled permits for a seasonally adjusted rate of 478,000 apartments in buildings with five units or more, an 8.1% YOY increase and a 2.1% increase compared to May. Dive Insight: While multifamily starts jumped in June, the feeling in the apartment development and finance community is that it is still extremely difficult to underwrite deals. Part of the issue is the still-high delivery levels in many areas of the country. However, the amount of new deliveries in buildings with five or more units is starting to decline, according to Census figures. At the end of June, 720,000 units were under construction, a 19.6% YOY drop and a 0.6% month-over-month decline. Multifamily developers finished an annualized 383,000 apartments in buildings with five or more units, a 39.8% YOY drop and a 21% month-over-month decline. With the new supply, acquiring existing properties has become more attractive for many equity investors. 'You're seeing that in some markets, you can buy a new product below replacement costs,' Berkadia Managing Director Brad Williamson told Multifamily Dive. However, Williamson said that his team is still working on construction loans, with about $2 billion closed as of this summer. 'We're doing a lot of multifamily construction and condo construction,' Williamson said. Williamson also pointed out that not all new construction is equal. 'The garden product on the multi side pencils a lot better,' he said. 'But once you get into the mid- and high-rise, those deals tend to be more expensive to build and tend not to pencil.' Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
19-07-2025
- Business
- Yahoo
ResProp Management reportedly acquires 304 units in Florida for $37M
This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Built in 1974, the Gateway on 4th Apartments in St. Petersburg, Florida, has consistently maintained strong occupancy despite its age. That occupancy, along with the property's location in one of Florida's fastest-growing metros, was an attraction to the most recent buyer, according to Berkadia Managing Director Brad Williamson. Florida's Business Observer identified ResProp Management as the purchaser of the 304-unit property. The Austin, Texas-based firm acquired the asset from a South Florida investor for $37 million on June 30. 'They [the buyer] owned and operated a lot of similar properties on the west coast of Florida,' Williamson said. 'They like the location and felt it was a good addition to their portfolio.' Williamson, who financed the property the last two times it was sold, attributes the asset's performance to strong management. 'We've worked with both the seller and we've worked with the buyer,' Williamson said. 'Both groups have strong track records in property management.' Berkadia originated a Freddie Mac-backed $33.3 million fixed-rate loan with a five-year term and three years of interest-only payments. Williamson, Berkadia Associate Director Wes Moczul, Senior Managing Director Mitch Sinberg and Managing Directors Scott Wadler and Matt Robbins of Berkadia Miami and Boca Raton arranged the financing. 'We're seeing an appetite from lenders, debt, funds, banks and life companies, but Freddie and Fannie have been by far the cheapest cost of capital in the market,' Williamson said. 'When you run a process, it typically stands out as the best option.' Gateway on 4th Apartments consists of 32 two-story apartment buildings on a 15-acre site offering a mix of one-, two- and three-bedroom apartments ranging from 618 square feet to 1,498 square feet. The property's amenities include a swimming pool with sundeck, 24-hour fitness center, bark park, dog wash station, outdoor kitchen with picnic seating, firepit area, jogging trail and children's playground. 'The property has been well kept, and there were limited to no deferred payments,' Williamson said. The buyer plans several in-unit renovations, including adding washers and dryers, installing new appliances and replacing floors and fixtures as needed. 'With any older property, there's always an opportunity to do upgrades,' Williamson said. Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday. Recommended Reading San Diego-area apartment trades for $82M
