PROFILE: Greystar Real Estate Partners LLC

By Keat Foong, Executive Editor

In 2011, Greystar Real Estate Partners LLC occupied for the first time the number one spot as the nation’s largest apartment manager. That may not come as much of a surprise as Greystar has continuously recorded the largest portfolio growth of any management company for the past three years in the NMHC 50 ranking.

If you asked Andrew Livingstone, executive director, he would not admit that the company is buying other operators for the sake of growth. “Our philosophy has never been to be the biggest. I think culturally, you cannot acquire five or six companies that all have the same mindset,” says Livingstone.

Greystar has expanded its property management portfolio, which currently totals 187,360 units in NMHC’s 2011 list of the largest apartment managers, through a combination of organic growth—via repeat business, word of mouth, purchases of apartment properties and new development—as well as acquisitions of other management companies.

What has particularly boosted Greystar’s apartment management portfolio in recent years, and its position in the NMHC Top 50 managers’ rankings, is its acquisitions, in late 2008, of JPI Management Services, and in 2010, of the Seattle-based Glacier Real Estate Services.

Both transactions entailed Greystar’s picking up the fee management contracts of the acquired companies, and took the company to an apartment management portfolio topping 185,000 units. With regards to the acquisition of JPI Management Services, Greystar took on the management contracts of an additional 120 properties, along with 1,100 employees, in one fell swoop. Additionally, the merger allowed it to gained a foothold in California, the Northeast and the Midwest, among other markets.

In its apartment management company acquisitions, Greystar considers it critical to acquire companies with the same culture, comments Livingstone. “In those two acquisitions, we very successfully aligned with folks who were culturally like us,” he says.

Greystar was founded in 1993 by CEO Bob Faith after a merger with Greystone. Greystar today has over over 5,000 employees, and it is organized into six regions, each of which has an apartment management, development and investment representation. “We call this our three legged stool. In each region, we like to have all three capabilities, so that we can take advantage of all market opportunities that should arise,” says Livingstone.

With ownership interests in about 17,000 units or about 60 properties, Greystar is also growing its apartment management portfolio through its acquisitions and development activities. The company reinstated its development activities at the end of 2010. “In October 2010, we started to see opportunities, and began closing our first two projects by the end of the year,” says Scott Wise, executive director.

Greystar currently has six apartment projects, totaling 3,000 units, under development, says Wise. The projects include a 404-unit development in Tysons Corner in the Washington, D.C. metropolitan area. The opening of that development is slated to coincide with the launch of a new Metro train station in April 2012, says Wise. Other current projects are located in Raleigh, N.C., Dallas and Houston. About 10 to 12 apartment projects in total are expected to be under construction by April of next year, says Wise.

Because Greystar was able to keep its team together through the downturn, it is now able to move very quickly on some of the best sites. “We feel that the lack of new apartment supply has allowed us to deliver supply very early on this cycle,” says Wise. Traditionally, Texas and Florida are Greystar’s development strongholds. Going into the future, “there are definitely a lot of growth opportunities in Atlanta, the Northeast and the West Coast. We will continue to selectively develop when opportunities are present,” says Wise.

After a number of years of expansion, whether of its management or ownership portfolio, Greystar now has a presence in 34 states and more than 100 markets. “We can service any client no matter where they invest,” says Livingstone.