WASHINGTON, D.C. – (By Dale King, Realty News Report) – Texas apartment firms fared well in the National Multifamily Housing Council’s newly released 2018 NMHC 50 — the annual ranking of the nation’s largest apartment owners, managers, developers and builders.
MAA, headquartered in Memphis, Tenn., was the country’s largest apartment owner for at least the second year in a row, with 99,792 units in possession. Starwood Capital Group of Greenwich, Conn., was second – as it was last year – with 88,946.
Clearly, Dallas has an edge among Texas-based owners. Three firms in Big D are in the top 50 – Lincoln Property, number 8, with 60,518; Invesco Real Estate, number 29, 31,319 apartments owned and Westgate Real Estate Investment and Management, number 32 (same as last year) with 28,599.
Houston’s sole company in the NMHC 50 list is, again, Camden Property Trust, ranking number 11 (up from 14 last year) with 53,033, slightly more than it owned in 2017.
Other Lone Star multifamily owners on the big 50 are: Hunt Companies of El Paso, number 7, with 60,635, and American Campus Communities of Austin, the only firm specializing in student dwellings, at number 27.
Greystar Real Estate Partners of Charleston, S.C., remained the largest apartment manager, with 418,475 units under that firm’s responsibility. The reports cites the firm as “the industry’s top dog. Its portfolio is more than twice that of the next two.”
Houston has a pair of companies on this list – Asset Plus Companies at number 17 (up one notch from 18th last year), managing 60,007 units, and Camden Property Trust at number 21 (down one notch from 20 last year), 53,033 units under its control.
Dallas again rules the Texas roost in this area with three companies in the top 50 apartment managers list: Lincoln Property Co., number 2 (same as last year), 190,542; Pinnacle, number 3 (unchanged from last year), 162,000 and Westdale Real Estate Investment and Management, number 29 (up from 31), 44,159.
Austin had two: American Campus Properties, number 27 (up from 29), 46,418 and Capstone Real Estate Services, number 42 (down from 39), 35,710.
Other Texas communities with a single firm on the list are: Hunt/LEDIC Realty Co. Associates, El Paso, Number 13 (down from 11), 65,993 and United Apartment Group of San Antonio, number 41 (down from 40 last year), 36,043.
Greystar Real Estate Partners also remained at the zenith of the top 25 apartment developers list, with construction starting on 5,651 units in 2017. Houston has a single company in the top 25, Hanover, at number 15, with 2,313 construction starts in 2017.
Dallas places five on the list: Mill Creek Residential, number 2 (up from 4), 5,293 unit starts; Lincoln Property Co., number 5 (up from 6), 5,002 starts; Trammell Crow Residential, number 6 (down from 5) 3,863 starts; Streetlights Residential, number 11, a new entry on the list, with 2,607 starts and Billingsley, a company at number 22 (up from 24), with 2,065 starts in 2017.
Texas communities with a single firm on this list include Irving-based JPI, number 9, a newcomer on the roster, with 2,832 and American Campus Communities of Austin, number 17 (down from 15), 2,219.
Summit Contracting Group, Inc., headquartered in Jacksonville, Fla., took the lead spot on the list of the nation’s top 25 third-party apartment builders, starting 6,053 apartments in 2017. In the number 2 spot was Oden Hughes of Austin, which made a major jump from 25th place in last year’s report. In 2016, the firm started 1,477 projects; last year, 5,220.
Dallas placed four firms on the list of top builders: Mill Creek Residential, number 5 (down from 4), 4,315 units started; Trammell Crow Residential, number 7 (up from 8), 3,420 starts; Streetlights Residential, 2,275 starts to put it in the No. 20 spot – it was not on the report last year. Billingsley, with 2,065 starts, ranked 23, up a notch from last year’s 24.
Hanover, from Houston, made its first appearance on this roster at number 19 with 2,313 starts. Irving-based JPI also showed up for the first time with 2,832 starts to place it in the number 11 location. Last on the list of 25 was Embrey Partners Ltd. of San Antonio, 1,948 starts. It was not on last year’s list.
Alden Torch Financial (headquartered in Denver) continued as the country’s largest apartment tax credit syndicator with 162,123 apartments syndicated. The report contains no Texas-based firms in this category.
The NMHC report made no mention of weather-related troubles such as Hurricane Harvey. “It is with an eye toward longer-term trends that we examine this year’s apartment leaders,” it says.
A hallmark of the current economic expansion has been the remarkably strong demand for apartment homes,” says NMHC chief economist Mark Obrinsky, writing 2018 NMHC 50 report.
To meet that growing demand, developers and builders have greatly stepped up production, a fact reflected in the top 25 developer and builder lists in the new NMHC report.
“Powerful demographic trends combined with a turn away from owning has fueled the rise in renting,” Obrinsky adds.
The NMHC study does reference some “challenges” that can slow development such as “a shortage of sites, less available construction financing from banks and even a shortage a workers, all of which can delay the construction timetable.”
“Strong underlying demand and investment performance metrics continue to buoy the market,” said Obrinsky. “While there may have been some signs of deceleration and market leaders have shifted strategies, the industry’s fundamentals remain robust.”
Additional industry and NMHC 50 highlights are:
• 2,066,945 – Number of units collectively owned by the firms on the NMHC 50 top owners list, representing 10.1% of the total apartment stock in the U.S.
3,282,557– Number of total units managed by the firms on the NMHC 50 top managers list, an all-time high and a 3.3% growth over last year.
95.1%– Apartment occupancy rate in 2017, according to RealPage; this is slightly below the unusually high levels of the last few years, but well above the post-1999 average of 94.4%.
346,900– Number of apartments completed in 2017, according to the Census Bureau—the highest level since 1989.
343,037– Absorptions of apartments in 2017, the best year since 2000 by a wide margin.
$152.7 billion– Total multifamily transaction volume for 2017, according to Real Capital Analytics
NMHC partnered with Kingsley Associates, a leading real estate research and consulting firm, to conduct the analysis for the NMHC 50.
For more details about the report, including historical information, visit nmhc.org/The-NMHC-50