Alliance isn’t alone in its optimism. About 42 percent of multifamily firms are increasing their acquisition appetite, while another 36.5 percent plan to start more development projects over this coming year, according to a survey of 138 senior-level multifamily finance professionals conducted in August by Multifamily Executive’s sister magazine, Apartment Finance Today. What the data—and interviews with active players in the industry—indicate is that multifamily firms are feeding their growing appetites for new construction and acquisitions more aggressively than at any point since the Great Recession. And the first order of business is to determine what their particular plans for the future entail.
A Rebound in Values
Like many firms, Alliance has been selectively selling off assets to help fuel its own ever-growing acquisition and development appetite. And it’s a great time to sell—the rebound in values has prompted many firms to reconsider their hold periods.
At the beginning of 2011, UDR wasn’t planning any dispositions for the year. Yet the REIT recently revised that forecast significantly. “Cap rates compressed much quicker than anybody expected, and it’s become the new norm,” says David Messenger, CFO of the Denver-based firm. “It hasn’t changed our acquisition strategy, but it’s one of the reasons we’re marketing between $400 million and $600 million [in asset sales].”
