MHN Exclusive: Landmark Adds $443M in Assets During 4Q13

The fourth quarter capped an extremely active 2013 for Landmark Apartment Trust of America. Over the course of the year the company acquired close to 16,000 units, representing over $1 billion in transaction value.
Jay Olander

Jay Olander, CEO of Landmark Apartment Trust of America Inc.

Tampa—Landmark Apartment Trust of America Inc. has closed on (or agreed to acquire) 13 apartment properties and seven joint venture ownerships during the fourth quarter of 2013.  The total investment in Southern U.S. properties for the quarter  stood at $443 million. All together, the properties contain 7,261 units that are 94 percent occupied.

The largest chunk of the portfolio is in metro Dallas, with eight properties including more than 3,000 units in throughout the city and its suburbs of suburban Garland, Mesquite, and Plano. Other properties acquired by Landmark are in Florida (more than 2,100 units), Alabama, Georgia, and North Carolina. The geography of the acquisitions fit in with the focus of the REIT, which is bullish on the South.

LATA also acquired two properties totaling 528 units on behalf of Timbercreek U.S. Multi-Residential Opportunity Fund #1, in conjunction with its investment partner Timbercreek Asset Management Inc. Landmark will manage the two assets.

Joe Lubeck

Joe Lubeck, executive chairman of Landmark Apartment Trust of America

“The key to this acquisition is that the properties are located in areas of jobs creation and population growth,” Landmark executive chairman Joseph Lubeck tells MHN. “The fundamentals for workforce housing in these markets are superb. They fit in with our goal to be the preeminent repositioner of mid-market multifamily assets in the Sunbelt.”

Specifically, as Landmark CEO Jay Olander tells MHN, “Demand is very strong, being driven by baby boomers who haven’t been in the market in years, and echo boomers who are now in their renting years, which are longer than they used to be. Moreover, supply is not rising to meet the demand.”

While apartment prices even in secondary markets are going up, Lubeck adds that Landmark has been able to negotiate good deals.

“The best way to acquire is through privately negotiated transactions for larger portfolios,” says Lubeck. “That way you’re not in the biding competition.”

Many of the properties in this acquisition count as value-adds, Olander says, which is a good way to drive rents in the wake of improvements. But they’re attractive for another reason: since they’re a little older than the properties now being developed, which tend to be on the peripheries of metro areas, the properties are often closer to job-generating companies and industries, which tend to be centrally located (hospitals, schools and government agencies, for example).

Olander adds that the company will continue to look for assets in Southern markets that enjoy better-than-U.S. average growth.

“Some secondary markets have home been our strongest performers. We’re going to follow job growth and growing economies wherever it takes us.”

All together, Tampa-based Landmark acquired 50 properties in 2013 containing more than 15,800 units for a little more than $1 billion, bringing its total number of properties to 69. The company also manages more than 100 properties totaling more than 32,000 units.