Walker & Dunlop to Acquire Alliant Capital, Affiliates for $696M

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Walker & Dunlop has entered into a definitive agreement to acquire Alliant Capital and its affiliates, Alliant Strategic Investments and ADC Communities, for a total enterprise value of $696 million. Subject to certain regulatory approvals, the deal is expected to close in the fourth quarter of 2021.

Alliant focuses on the affordable housing sector through low-income housing tax credit syndication. Alliant has developed more than 100,000 affordable units and has become the sixth LIHTC syndicator in the U.S., according to a release issued by Walker & Dunlop. The privately held alternative investment manager has $14 billion of affordable assets under management, to be added to Walker & Dunlop’s $2 billion portfolio.

The terms of the purchase agreement include $351 million of cash and assumption of Alliant’s securitized debt facility, $100 million of earn-out structured as participating interest in future cash flows over the next four years, and $90 million of W&D common stock, with the number of shares to be determined at closing.

The appeal of affordable housing

According to Richard Lara of RAAM Construction, affordable housing is poised to outperform. It comes as no surprise that multifamily overall and affordable housing have outperformed most sectors throughout the health crisis. As pent-up demand for affordable housing persists, investors and developers are drawn to the segment.

With occupancy rates in affordable communities mostly at the higher end of the spectrum and low turnover, the sector represents a steady investment source, even in times of economic volatility.