UDR, MetLife to Swap Stakes in Joint Venture Multifamily Portfolio Valued at $1.8B

by John Nelson

DENVER AND NEW YORK CITY — UDR Inc. (NYSE: UDR), a multifamily REIT based in Denver, has struck an agreement with its joint venture partner MetLife Investment Management to swap their interests in a national multifamily portfolio in a deal valued at nearly $1.8 billion.

As part of the agreement, UDR will buy out MetLife’s stake in 10 apartment communities, one property under construction and four development land sites that are collectively valued at $1.1 billion.

The 10 properties total 3,321 units and include Strata in San Diego; Crescent Falls Church in Falls Church, Va.; Charles River Landing, Lodge at Ames Pond and Lenox Farms in metro Boston; Towson Promenade in Towson, Md.; and the 1,513-unit, four-property Vitruvian Park campus in Addison, Texas. The assets have an average age of eight years and 95.7 percent occupancy at the time of this announcement.

“The acquired communities are primarily located in markets targeted for expansion, are immediately accretive to our earnings, have operational upside and improve the diversification of our portfolio,” says Tom Toomey, chairman and CEO of UDR.

Also as part of the agreement, MetLife Investment Management will purchase UDR’s stake in five apartment communities valued at a combined $645 million. Those assets total 1,001 units and include the Ashton Austin in Austin; The Olivian in Seattle; Current in San Diego; Acoma in Denver; and 717 Olympic in Los Angeles. The properties have an average age of 10 years and 96 percent occupancy at the time of this announcement.

The transaction is expected to close in the fourth quarter, after which the assets remaining in the UDR/MetLife Investment Management joint venture will span 13 properties in California, Boston, New York and Philadelphia.

“We look forward to continuing to partner with MetLife Investment Management on the remaining properties in the joint venture relationship,” says Toomey.

UDR owned or had an ownership position in 50,829 apartment units including 366 under development as of June 30. The REIT’s stock price closed on Monday, Aug. 12 at $47.06 per share, up from $38.61 a year ago.

MetLife Investment Management is MetLife’s (NYSE: MET) institutional asset management business. The New York City-based real estate manager provides investment solutions to institutional investors worldwide. As of March 31 the firm had approximately $606 billion in combined assets under management.

— John Nelson

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