Kennedy Wilson Expands Idaho Portfolio
- Jun 22, 2021
Kennedy Wilson has expanded its Boise, Idaho, multifamily portfolio with the acquisitions of three properties in the region totaling 640 units for $143 million, and an Opportunity Zone development site where 240 units can be built.
The three properties in the separate off-market transactions include one wholly owned asset, The Lofts at Ten Mile, a 240-unit apartment community in Meridian, Idaho. The other two assets, Jasper Apartments, a 240-unit property also in Meridian, and Towne Square, a 160-unit property in Boise, were purchased with Boise-based real estate investment company Roundhouse.
Kennedy Wilson and Roundhouse also acquired the Dovetail development site, an Opportunity Zone parcel in Meridian entitled for 240 units. The Dovetail development, which will cater to residents seeking a suburban, outdoor-oriented lifestyle with an emphasis on sustainability, is expected to be completed in 2023. The development will cost an estimated $60 million to construct, including approximately $19 million in equity committed by Kennedy Wilson over the life of the development.
Kennedy Wilson has an average ownership of 95 percent in the four investments. The company has invested $68 million of equity into the properties using either fixed-rate financing or floating-rate financing hedged against long-term increases in interest rates. Kennedy Wilson plans to add and enhance amenities and update unit interiors in the existing properties.
Mountain State Moves
Kennedy Wilson has been investing in the Mountain States region since 2012. Including those under development, the company now owns about 2,500 market-rate apartments in the Boise region, making it the largest owner of conventional multifamily property in the Boise metro.
All properties were either developed through a build-to-hold business plan or secured through off-market transactions from private sellers. The purchases also reflect Kennedy Wilson’s continued focus on recycling equity capital from dispositions into high-quality multifamily properties throughout the Mountain States.
The company and partner Roundhouse recently completed construction of The Clara, a 277-unit multifamily development in Eagle, Idaho. The property is nearing full lease-up months of ahead of the business plan, according to Kennedy Wilson.
Nick Bridges, managing director at Kennedy Wilson who oversees multifamily investments in the region, said in a prepared statement they expect continued growth in population and employment as both individuals and employers seek relative housing affordability, lower taxes, a friendlier business environment, better infrastructure and access to the outdoors.
Bridges said those trends, which had existed prior to the pandemic, were accelerated during the COVID-19 crisis as both Baby Boomers and Millennials sought a higher quality of life in the Mountain States.
In November, Kennedy Wilson acquired two multifamily properties in Colorado and one in Arizona totaling 880 units for $198 million. The apartment communities are Rockrimmon, a 260-unit property in Colorado Springs, Colo.; RockVue, a 220-unit Broomfield, Colo., property; and Tempe Station, a 400-unit property in Tempe, Ariz.
Rockrimmon is wholly owned by Kennedy Wilson and the other two are being held in the company’s co-investment portfolio with Kennedy Wilson holding an average ownership of 10 percent across the two assets.
Kennedy Wilson now owns more than 10,000 units in the Mountain States.