UDR, Inc. (the “Company”) (NYSE: UDR), a leading multifamily
real estate investment trust and GRESB 5 Star rated company for its
sustainability leadership, announced today that it has closed a
$510 million joint venture with LaSalle Investment Management (the
“Partner”). The Company and the Partner intend to grow the joint
venture over time through the acquisition of high-quality,
well-located communities with operational upside that can be
recognized through the implementation of UDR’s industry-leading
operating platform.
Under the terms of the agreement, UDR will:
- initially contribute four communities totaling 1,328 apartment
homes (the “seed portfolio”) into the joint venture;
- retain a 51 percent ownership in the communities included in
the joint venture; and,
- receive approximately $250 million in cash proceeds.
The joint venture will initially have no debt. The value of the
seed portfolio is based on a low-5% effective forward yield, and
the Company expects the transaction to be accretive to FFOA and
cash flow per share in the first year of the venture.
Details on the communities included in the seed portfolio, which
are diversified across geography, age, price point, and offer
various value-add opportunities, are presented in the table
below.(1)
Community
Market
Homes
Age (Years)
Monthly Revenue per Occupied
Home
Occupancy
The Hawthorne Apartments
Seattle
284
20
$2,787
97.3%
Los Alisos at Mission Viejo
Orange County
320
9
2,791
97.1%
Lodge at Ames Pond
Boston
364
13
2,516
97.7%
Signal Hill Apartments
Washington, DC
360
13
2,046
98.0%
Total / Weighted Avg.
-
1,328
14
$2,513
97.6%
(1) Data as of June 2023.
The Company serves as the manager of the joint venture and will
earn asset management, property management, financing, and
construction management fees. For new acquisitions made through the
venture, the Company will earn acquisition fees and the potential
to earn a promoted return should certain return hurdles be
achieved.
“We are pleased to establish a new joint venture with such a
high-quality partner,” said Tom Toomey, UDR’s Chairman and CEO.
“The venture validates the success of UDR’s operating platform,
innovation, and unique value creation mechanisms, which have led to
the highest controllable operating margin among our peer group and
earnings per share growth that is consistently above the peer
average. Additionally, the venture expands UDR’s strategy of
diversifying among capital sources that provide the Company the
ability to execute accretive investment opportunities across
economic and market cycles. We look forward to growing this venture
with our Partner over time to the benefit of our stakeholders
through increased operating scale, densification, and earnings
accretion.”
Forward-Looking
Statements
Certain statements made in this press release may constitute
“forward-looking statements.” Words such as “expects,” “intends,”
“believes,” “anticipates,” “plans,” “likely,” “will,” “seeks,”
“estimates” and variations of such words and similar expressions
are intended to identify such forward-looking statements.
Forward-looking statements, by their nature, involve estimates,
projections, goals, forecasts and assumptions and are subject to
risks and uncertainties that could cause actual results or outcomes
to differ materially from those expressed in a forward-looking
statement, due to a number of factors, which include, but are not
limited to, general market and economic conditions, unfavorable
changes in the apartment market and economic conditions that could
adversely affect occupancy levels and rental rates, including as a
result of COVID-19, the impact of inflation/deflation on rental
rates and property operating expenses, the availability of capital
and the stability of the capital markets, rising interest rates,
the impact of competition and competitive pricing, acquisitions,
developments and redevelopments not achieving anticipated results,
delays in completing developments, redevelopments and lease-ups on
schedule or at expected rent and occupancy levels, changes in job
growth, home affordability and demand/supply ratio for multifamily
housing, development and construction risks that may impact
profitability, risks that joint ventures with third parties and DCP
investments do not perform as expected, the failure of automation
or technology to help grow net operating income, and other risk
factors discussed in documents filed by the Company with the SEC
from time to time, including the Company's Annual Report on Form
10-K and the Company's Quarterly Reports on Form 10-Q. Actual
results may differ materially from those described in the
forward-looking statements. These forward-looking statements and
such risks, uncertainties and other factors speak only as of the
date of this press release, and the Company expressly disclaims any
obligation or undertaking to update or revise any forward-looking
statement contained herein, to reflect any change in the Company's
expectations with regard thereto, or any other change in events,
conditions or circumstances on which any such statement is based,
except to the extent otherwise required under the U.S. securities
laws.
About UDR, Inc.
UDR, Inc. (NYSE: UDR), an S&P 500 company, is a leading
multifamily real estate investment trust with a demonstrated
performance history of delivering superior and dependable returns
by successfully managing, buying, selling, developing and
redeveloping attractive real estate communities in targeted U.S.
markets. As of March 31, 2023, UDR owned or had an ownership
position in 58,411 apartment homes including 415 homes under
development. For over 51 years, UDR has delivered long-term value
to shareholders, the best standard of service to residents and the
highest quality experience for associates.
About LaSalle Investment
Management
LaSalle Investment Management is one of the world’s leading real
estate investment managers. On a global basis, LaSalle manages over
$78 billion of assets in private and public real estate property
and debt investments as of Q1 2023. LaSalle’s diverse client base
includes public and private pension funds, insurance companies,
governments, corporations, endowments and private individuals from
across the globe. LaSalle sponsors a complete range of investment
vehicles including separate accounts, open- and closed-end funds,
public securities and entity-level investments. For more
information please visit www.lasalle.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20230629089950/en/
UDR, Inc. Trent Trujillo
ttrujillo@udr.com 720-283-6135
UDR (NYSE:UDR)
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