Contact: Kimberly Duty, (202) 974-2333, kduty@nmhc.org
FOR IMMEDIATE RELEASE
March
15, 2002
ANNUAL
NMHC RANKING OF TOP APARTMENT FIRMS
SHOWS
CONSOLIDATION CONTINUES DESPITE DOWNTURN
WASHINGTON,
DC -- Despite the challenging economic times, the apartment industry continued
its trend toward greater concentration, according to the 13th annual NMHC
50, the National Multi Housing Council’s (NMHC) annual ranking of the
nation’s largest apartment companies. Published
in conjunction with PRIMEDIA’s National Real Estate Investor magazine,
the NMHC 50 has become the definitive source of information on trends
in apartment ownership and management.
“One
of the key findings in this year’s report,” according to NMHC Chief
Economist, Mark Obrinsky, “is that the pace of consolidation picked up in
2001 even though the operating environment for apartments changed
substantially, from the end of the nation’s longest economic expansion to
the dislocation and uncertainty caused by the terrorist attacks of September
11 and their aftermath.”
The
50 largest apartment owners increased their holdings by 6 percent in 2001, a
considerable increase from the 3 percent growth rate recorded in 2000.
As of January 1, 2002, they collectively owned 2.77 million apartment
units or approximately 17 percent of the total national stock.[1]
Ten years ago, the NMHC 50 only owned 11 percent of the national stock.
The
NMHC 50 apartment managers also expanded their portfolios last year, growing
by almost 4 percent. This was also a rebound from last year, when there was
essentially no change in the number of apartments managed by the top 50 firms.
The NMHC 50 managers manage 2.44 million apartments, just over 15
percent of the total stock, and up from 11 percent of the national stock 10
years ago.
The
consolidation did not translate into a larger market share for the publicly
traded real estate investment trusts (REITs).
REITs once again outperformed the overall stock market, but equity
capital remained scarce which put a lid on overall growth. REITs still hold
two of the top three places in the NMHC 50 list of top apartment owners, but
overall there are fewer REITs on this year’s list, only 11, down from 13
last year, and from 16 in 2000. After
rapid growth in the 1990s, public REITs among the NMHC 50 held over one
million apartments. The last two
years have seen this total drop by 10 percent.
Apartment
Investment and Management Company (AIMCO) retained the top spot among the NMHC
50 owners (with an ownership interest in 251,201 apartment units) and the NMHC
50 managers (with 303,805 units). While
AIMCO retained its position as #1 in both NMHC 50 rankings, which are based on
the number of apartment units, Equity Residential is 67 percent larger than
AIMCO by an alternative measure - total capitalization.
The
2002 rankings are attached. Highlights follow, and a complete analysis of the
results is available on the NMHC web site at www.nmhc.org/Top50/ListYears.cfm
or by calling 202/974-2354.
Additional
Ownership Key Findings
$
Related Capital recorded the
largest portfolio increase, adding more than 86,000 units in 2001. To put this
in perspective, Related Capital added almost as many apartments to their
portfolio as are owned by the four firms at the bottom of the NMHC 50 list.
$
Growth tended to be “top
heavy.” Holdings of the top 10
firms increased by 8.7 percent; portfolios of the top 25 grew by 7.2 percent;
and growth among the second 25 firms was 3.5 percent.
$
The threshold for entry into the
NMHC 50 owners’ list edged up from 20,956 to 21,626.
$
Reflecting the relative stability
of the apartment industry, only four new firms were added to the NMHC 50 Owners
for 2002: Key Global Capital (#19); Fairfield Residential (#25); Pinnacle Realty
Management (#42); CLK Management (#45).
Additional
Management Key Findings
$
In contrast to the owners’
growth, which was concentrated at the top, the managers’ increase was spread
broadly throughout the list. The
top 10 also increased their management portfolios by 3.7 percent, the top 25
portfolios increased by 3.4 percent, and portfolios of the second 25 showed a
gain of 4.5 percent.
$
The biggest gainer on the NMHC 50
management list was posted by Archstone-Smith, largely by virtue of its merger
with Charles E. Smith Residential. The
firm now manages 103,000 apartments.
$
The threshold for entry into the
NMHC 50 managers’ list edged up from 19,465 to 21,105.
$
Seven new firms were added to
this year’s NMHC 50 Managers: Fairfield Residential (#13); WinnResidential
(#20); Associated Estates Realty (#25); Legacy Partners (#30); Security
Properties (#34); Alliance Residential (#36); and Shelter Development (#44).
Methodology:
To ensure the
NMHC 50 for 2002 is as complete and accurate as possible, NMHC officials
gathered names of apartment owners and managers from a wide range of sources. A
senior officer from each firm was contacted for the information included in the
rankings, which are for properties owned or managed on January 1, 2002. The rankings are based solely on rental apartments.
Condominiums, cooperatives, hotel rooms, nursing home and hospital rooms,
and mobile homes are not included. Pension fund advisory firms are listed only
if they have direct ownership interests (as opposed to interests as fiduciaries)
or serve directly as property managers.
* *
*
Based
in Washington, DC, NMHC is a national association representing the interests of
the larger and most prominent apartment firms in the U.S. NMHC's members are the
principal officers of firms engaged in all aspects of the apartment industry,
including ownership, development, management and financing. More than one-third
of Americans rent their housing, and one in five Americans lives in an
apartment. For more information, contact NMHC at 202/974-2300, e-mail the
Council at info@nmhc.org,
or visit NMHC's web site at www.nmhc.org.
###
[1]
The apartment stock is defined as the total number of apartments in
structures with at least five units.
