Greystar sells multifamily portfolio to Ivanhoé Cambridge for $3.6B

Deal involves 10K units across 30 properties mainly in Sun Belt, coastal suburbs

Greystar sells multifamily portfolio to Ivanhoé Cambridge for $3.6B
Greystar CEO Bob Faith, Ivanhoé Cambridge CEO Nathalie Palladitcheff (Greystar, CDPQ)

Weeks before the pandemic locked down the U.S., Greystar CEO Bob Faith emphasized his bullish stance on multifamily real estate, telling Bloomberg that the sector “offered stability going into a potential downturn.”

This week’s $3.6 billion sale of 30 properties in growth markets including the Sun Belt and coastal suburbs underscores his point.

The South Carolina-based multifamily owner unloaded the nearly 10,000-unit portfolio to Canadian real estate investment firm Ivanhoé Cambridge, PERE reported.

After toying with the idea of a piece-by-piece selloff, Greystar opted for a single buyer, given the heightened demand for multifamily assets, according to PERE. Ivanhoé Cambridge secured the portfolio in August after three rounds of bidding.

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The properties comprised Greystar Equity Partners IX, a value-add fund which the firm launched in 2015 and closed the next year with $1.25 billion in equity. Kevin Kaberna, leader of Greystar’s North American investment management platform, did not divulge the total capital deployed for the fund to PERE.

The sale follows Greystar’s launch of its 10th value-add fund, GEP X, early last year.
Greystar had enough liquidity and confidence to maintain investment momentum and secure properties at “significant discounts in 2020 and the first part of 2021,” Kaberna told PERE.

The firm has invested $2.5 billion in the fund, which was fully deployed at over $4 billion, including debt, this summer, Pere said.

The sale to Ivanhoé Cambridge marks the firms’ second deal together this year.

The pair, in conjunction with Bouwinvest Real Estate Investors, picked up an office building in Paris this September with plans to develop 370 co-living units. The agreement is part of the group’s $1.1 billion joint venture to develop and acquire housing for students and young professionals.

Greystar and Ivanhoé also developed The Hudson, a mixed-use development in Pasadena, California, with 173 residential units and 11,000 square feet of ground-floor retail. The firm sold the project to Waterford Property Company, which had partnered with the California Statewide Communities Development Authority in June, for $98 million.