REAL ADVANTAGE, RECOGNIZED. CBRE is honored to be named the top apartment sales broker in 2016 by Real Capital Analytics, an achievement we have received recognition for since 2001. How can we help transform your real estate into real advantage? 5DQNLQJUHÁHFWVDSDUWPHQWVDOHV0 For more information contact or visit: [email protected] cbre.com/multifamily TABLE OF CONTENTS Introduction ............................................................................................................... 4 Top 50 Owners........................................................................................................... 6 A Changing of the Guard ..........................................................................................8 Top 50 Managers .....................................................................................................12 Path of Growth......................................................................................................... 14 Top 25 Developers .................................................................................................. 18 Top 25 General Contractors .................................................................................. 19 Building to the Market ............................................................................................20 Methodology ............................................................................................................ 23 Top 10 Syndicators ..................................................................................................24 Uncertain Times ......................................................................................................26 NMHC Officers ....................................................................................................... 30 NMHC Executive Committee ................................................................................30 NMHC Board of Directors ..................................................................................... 36 ABOUT NMHC Based in Washington, D.C., the National Multifamily Housing Council (NMHC) is the apartment industry’s premier trade association. NMHC provides leadership on legislative and regulatory matters, advances research and the exchange of strategic business information and promotes the desirability of apartment living. For more information, visit www.nmhc.org. 2 SPECIAL SUPPLEMENT BROUGHT TO YOU BY NMHC HAPPY RESIDENTS ARE LONG-TERM RESIDENTS. In our world of wireless, it is more important than ever to be equipped with the speed and bandwidth to handle an array of devices. We’ve got you covered. By off ering 1GB+ Internet speeds, professionally managed WiFi, full-featured Voice service and an extensive variety of entertainment options, you will attract—and retain—residents like never before. Add in 24/7 support and it’s clear: Spectrum Community Solutions delivers everything your residents need, and everything you want. SpectrumCommunitySolutions.com ©2017 Charter Communications. Inside the 2017 NMHC 50 Shifting market dynamics influence this year’s rankings, which include a new list of top syndicators. > By Mark Obrinsky The last eight years have been one of the strongest periods in the second-best showing since 2000. If that’s not a strong indication history for the apartment industry. The post-recession economic of solid apartment demand, absorptions and occupancy rates were. expansion, together with a tectonic shift in demographics and changes Last year, MPF’s average occupancy rate was 96.2 percent, a to the economics of and attitudes toward renting versus owning, level not seen since 2000. Absorptions also climbed 5.9 percent to unleashed a torrent of demand for apartments. In fact, the number 289,025, marking the third-best year in the current expansion. While of renter households has grown by 9.1 million over the past 10 years. restricted supply in some metro areas likely held back absorptions, the Last year alone, renters added 601,000 more to their ranks; this rate was still 87 percent higher than historical average. compares to just 279,000 new homeowners. Investment Activity Holds Strong This trend has had tremendous implications for the apartment Even with the slight deceleration in a few key market metrics, the industry, and the annual NMHC 50 rankings are a testament to that sector’s strong demand base continued to make apartments a favored fact. This is the 28th year for the NMHC 50. In that time, NMHC has asset class for investors. In 2016, multifamily transactions set a new grown its rankings package to include not only the top 50 apartment all-time high—for the third year in a row. At $159.4 billion, according owners and managers but also the top 25 developers, top 25 general to Real Capital Analytics, volume was 3.9 percent higher than in 2015, contractors and—new this year—top 10 syndicators. making multifamily the only real estate asset class to register a gain. The continued expansion of the research reflects the industry’s Cap rates continued to feel a gravitational pull, edging down to steady growth and growing sophistication in the fields of investment, an average of 5.7 percent overall. Rates for garden apartments were finance, operations, development and construction. Moreover, the higher at 5.9 percent, while those for mid- and high-rise were lower at annual changes in the listings themselves provide critical insight into 4.9 percent. All were record lows. Different industry measures showed how industry leaders are adapting their organizations and strategies to a wide range of appreciation rates in 2016 (2.6 percent according the ever-evolving market conditions. to NCREIF versus 12.0 percent in the Moody’s/Real Capital CPPI, This year’s rankings are no exception. To help put that information for example), but there was clear consensus that per-unit prices on in context, here’s a look at the major market trends that have apartments sold were at historic levels. influenced business strategy over the past year. As always, private buyers led both acquisitions and dispositions by Supply Catches Up with Demand volume. But for the second year in a row, cross-border investors were The industry has responded to the growing demand by ramping the leaders in net acquisitions with $3.4 billion, compared with $3.2 up production to new levels. For years now, cranes have dotted billion for private domestic buyers. REITs and listed funds were once city skylines across the country and new buildings have sprung up again the only investor group in net disposition mode, selling $19.1 seemingly overnight in some cases. billion in apartments while acquiring only $9.5 billion. Last year, completions of new multifamily units (in buildings with In terms of deal type, single-asset deals rose six percent in 2016, at least five units in them) totaled 311,700, according to U.S. Census while portfolio transactions were down three percent. Also of note, Bureau data. This was the highest level since 1989. And preliminary student housing posted transaction growth of 62 percent, much data indicate that the split between for-rent and for-sale (i.e., condo) higher than the overall apartment market. In that sector, large portfolio units has again changed, with for-rent apartments making up an even transactions were responsible for the big growth; the five top student greater share of multifamily construction. housing deals were responsible for 58 percent of the total volume. As supply has caught up with demand, both multifamily permits Read on to find out how our industry’s leaders navigated these and starts began to ease in 2016. However, even in their moderation, changing market dynamics—and how it affected their standings. ◾ they remained higher than at any previous year since 1987. Moreover, based on apartment units already started, completions this year likely will be closer to 350,000. Rent growth is also slowing to some degree in response to the new Mark Obrinsky is the senior vice president of research and chief supply, with same-store rent growth slipping a bit last year, according economist at the National Multifamily Housing Council. He can be to data from MPF Research; however, the 4.3 percent pickup was still reached at [email protected]. 4 SPECIAL SUPPLEMENT BROUGHT TO YOU BY NMHC 2017 TOP APARTMENT OWNERS 50 Largest U.S. Apartment Owners as of January 1, 2017 Owner Rank Units Owned Units Owned HQ 2017 Company Name 2017 2016 Corporate Officer HQ City State 1 MAA 99,393 79,496 H. Eric Bolton, Jr. Memphis TN 2 Starwood Capital Group 85,554 42,702 Barry S. Sternlicht Greenwich CT 3 Equity Residential 78,023 109,540 David J. Neithercut Chicago IL 4 AvalonBay Communities, Inc. 74,538 75,584 Timothy J. Naughton Arlington VA 5 Hunt Companies, Inc. 61,970 52,225 Chris Hunt El Paso TX 6 Edward Rose Building Enterprise 61,508 60,503 Warren Rose Bloomfield Hills MI 7 Lincoln Property Company 59,980 49,024 Tim Byrne Dallas TX 8 Essex Property Trust, Inc. 59,260 58,768 Michael J. Schall San Mateo CA 9 The Irvine Company 58,732 57,825 Chaz Mueller Newport Beach CA 10 Camden Property Trust 52,793 59,792 Richard J. Campo Houston TX 11 J.P. Morgan Asset Management 52,046 51,861 Allina Boohoff New York NY 12 UDR, Inc. 51,129 50,646 Thomas W. Toomey Highlands Ranch CO 13 BH Equities LLC 51,113 55,819 Harry Bookey Des Moines IA 14 The Michaels Organization 49,950 48,429 John J. O’Donnell Marlton NJ 15 Balfour Beatty Communities 49,163 48,698 Christopher Williams Malvern PA 16 Aimco 46,311 49,148 Terry Considine Denver CO 17 Weidner Apartment