|
News
Upfront
Aimco buys Casden Properties
Denver
– Apartment Investment and Management Co. (Aimco), the nation’s
largest apartment owner and operator, has added to its sizeable
holdings through a $1.5 billion acquisition of 17,383 units through
the purchase of Casden Properties.
The complex deal includes:
• 6,356 conventional apartment units in Southern California,
including 1,381 units in the Park La Brea area of Los Angeles
that are under development.
• 11,027 affordable apartments in 25 states.
• National Partnership Investments Corp. (NAPICO), a subsidiary
of Casden, which as a general partner controls more than 400 properties
with more than 41,000 units.
The addition of the Casden portfolio significantly increases Denver-based
Aimco’s presence in Southern California. When the Park La
Brea property is completed, the deal is expected to increase Aimco’s
real estate “free cash flow” earned in the Southern
California region from 3.5% to 15.9%.
The company’s owned and managed asset base increases from
$12.5 billion to $15 billion and Aimco’s total owned and
managed apartment portfolio to 363,000 units. In addition, NAPICO
increases Aimco’s controlled investment management assets
by more than $1 billion in gross real estate value.
Casden and a related REIT will merge into Aimco’s operating
partnership.
As part of the deal, the selling group, including founder Alan
Casden and affiliates of Blackacre Capital Management, LLC, New
York, will acquire $213 million in Aimco common stock and common
OP units at a price of $47 per share.
Casden is expected to complete the three phases of the Park La
Brea property between the second quarter of this year and the
third quarter of 2004. The purchase price for the 1,381 units
is $418 million and is payable upon completion and 60% occupancy.
The sellers may earn an additional $24 million based on property
performance.
The move gives Casden new opportunities to pursue more housing
projects. Officials quickly announced the formation of Casden
Development, LLC, a multifamily real estate development company,
with an initial capitalization of $320 million. Casden Development
will have an ongoing strategic alliance with Aimco in which Casden
will assume responsibility for all of Aimco’s current development
projects in the Los Angeles area.
The relationship will also serve as a platform for the development
of future multifamily projects in Southern California. Aimco will
have an option to purchase multifamily projects developed by Casden.
Aimco is investing up to $50 million for a 20% interest in Casden
Development.
“The company will develop both market-rate and affordable
housing in the Los Angeles area,” said Casden, chief executive
officer.
|
