Dive Brief:

• Last week, Standard Communities acquired a 100% affordable housing portfolio of over 6,000 apartment homes in more than 60 communities in four states, according to a press release. 
• The properties, most developed by the sellers, were built, on average, in 2002. New York City- and Los Angeles-based Standard will invest over $30 million in capital improvements and deferred maintenance across the portfolio while vowing not to displace any residents. 
• With the purchase of the portfolio, valued at over $1 billion, Standard entered Arizona, Colorado and Texas and grew its California portfolio to nearly 11,000 apartments. Standard’s overall holdings have expanded to nearly 27,000 units across 21 states and Washington, D.C. 

Dive Insight:

Although apartment sales have slowed since 2022, Standard has been active. 

In October 2023, the firm acquired six 100% affordable Section 8 communities, totaling 407 units, in Los Angeles County. In March 2023, it purchased a controlling interest in an affordable housing portfolio of nearly 3,200 units in Florida and Georgia.

“At Standard, we have a strong track record of thriving in unpredictable environments, and we are constantly exploring and evaluating ways to lower our cost of capital,” Christopher Cruz, managing director of Essential Housing for Standard Communities, told Multifamily Dive last year.

In a 2022 interview with Multifamily Dive, Jeffrey Jaeger, co-founder and principal of Standard Communities, laid out a plan to get his firm’s portfolio to 50,000 units. “As deals come up, I think we’re well-positioned to add equity in those situations where there’s less financing available,’ he said.

Standard has also led public-private partnerships with multiple government agencies, including the HUD, Fannie Mae, Freddie Mac and various states, to preserve long-term affordability.

Standard took control of the $1 billion portfolio by acquiring general and limited partnership interests, including controlling interests of managed tax credit funds with institutional investors. The firm also purchased various third-party subordinate notes to optimize partnership economics. 

“We navigated new financing facilities, tax credit investor partners, non-profit partners, ground lease buyouts and loan assumptions with numerous governmental and private lenders simultaneously on a fixed timeline,” Cruz said in the press release.

Standard isn’t finished. The firm is pursuing other large-scale opportunities. 

“We’re uniquely positioned to handle sizable portfolios amid increasing consolidation within the industry,” Cruz said in the release. “We expect portfolio acquisitions to continue to play a key role in our growth, and we have significant capital ready to support these strategic investments.”

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