Crescent Communities, a Charlotte, N.C.-based developer and builder, has opened an office in Denver as part of expanding its multifamily construction activities to key markets in the southwestern U.S.
The 44-year-old Crescent, which in April changed its name from Crescent Resources, hired Jim Cauley, a 25-year industry veteran, to spearhead this growth drive. Cauley most recently was managing partner with The Communidades Group, which focused on customized apartment buildings and services for Hispanic renters. His resume includes executive stints with Tarragon South Development, The Altman Companies and Trammell Crow Residential Southwest, where he was responsible for a 15,000-apartment portfolio.
The announcement signals the latest chapter for Crescent, which in May 2010 emerged from 11 months of court-sanctioned bankruptcy protection from creditors under Chapter 11, during which the company restructured and reduced its secured debt to $265 million from an estimated $1 billion. As part of that restructuring, Crescent is owned by two private equity firms, Anchorage Capital Master Offshore Ltd. and MatlinPatterson Global Opportunities Partners III, which last August pumped $100 million in new equity into the company.
Crescent has 16 multifamily communities that are in planning or development stages in five southeastern states. When completed, these projects will have a total of 4,600 units. Three quarters of what Crescent builds is urban infill, and its apartments average 960 square feet of living space.
Pre-bankruptcy, Crescent had indicated an interest in establishing a national footprint. And last August, the company finally took its first step west of the Mississippi River by completing a 176-unit, 476-bed student housing community called Circle West Campus, adjacent to the University of Texas in Austin, Texas. (Crescent sold that building three months later for $46.8 million.)
It appears that the company has set its sights on the major markets in Texas, as well as Denver (where Cauley is stationed) and Phoenix, where his first official project will be a 275-unit community in Scottsdale, Ariz., which Crescent is planning to develop with Glimcher Realty Trust.
In an interview with MFE on Tuesday, Brian Natwick, president of Crescent’s Multifamily Group, said the company will pay “a lot of attention to submarkets and micromarkets” in deciding where to build.
“If you’re planning for 2014 and 2015, you have to start looking today,” he said. “It’s like planting crops for future harvesting opportunities.”
Crescent’s communities typically range from 250 to 350 apartments. “That scale works because it fits well with our amenities package and a building’s operating efficiencies,” Natwick explained. He added that Crescent would consider suburban, urban and student housing opportunities as it moves west.
A coast-to-coast presence could become part of Crescent’s longer-term plans. But Natwick cautioned “we’re a big believer in measured expansion to create value for our stakeholders and financial partners.”
John Caulfield is senior editor with Builder, MFE’s sister publication.