Why Cortland Partners is Entering the Texas Market
- Apr 13, 2012
Dallas—Cortland Partners, an Atlanta-based real estate firm, has recently entered the Texas multifamily market with its acquisition of The Park at La Jolla, an apartment building in Plano, Texas. MHN interviews Steven DeFrancis, CEO, Cortland Partners, on why the firm has expanded to the Texas market.
MHN: What attracted you to the Dallas market? Why is this a good area for multifamily investors?
DeFrancis: The Dallas economy is one of the most robust in the nation and provides diversification in our economic model.
MHN: Will you continue to invest in Dallas? Where else is a good region for multifamily right now?
DeFrancis: We expect to grow our portfolio to at least 1,500 apartments in the Dallas area to achieve operating economies of scale. In addition to our presence in Atlanta, Dallas and Charlotte, we like Houston and major markets in north Florida.
MHN: Describe the process of repositioning properties. How is it done?
DeFrancis: Repositioning a property is very involved. We approach the process from two angles—the physical asset and the operating income streams. Our investment and construction teams address any deferred maintenance and upgrades to distinguish our product in the market place. This allows our property operations team to reset expenses and realize revenue opportunities previously not achievable due to the state of the physical asset.
MHN: What are some of the benefits of repositioning properties? Pitfalls?
DeFrancis: The benefit is a higher quality net operating income stream, which should manifest in higher property values. As with all complex processes the pitfalls are associated with the execution. We are renovating over, through and around existing residents and we want to create value for a better life with the least disruption possible.