Singapore-based CapitaLand has formed a joint venture with an Austin, Texas, real estate investment, development, and property management firm to scale its multifamily asset portfolio in the U.S. Through the joint venture, CapitaLand will have a strategic arrangement with its partner to acquire and develop multifamily assets totaling $300 million in gross asset value. The partners will invest in multifamily assets in the Southeast and Southwest markets, with Austin as their initial focus.
The joint venture will develop its first multifamily community in the high-growth tech hub of Austin. CapitaLand will hold an 80% stake in the project, with its partner holding the remainder. The 4.71-acre land parcel will be developed into a 341-unit suburban mid-rise property, which is expected to be completed in 2023.
The property will be designed to cater to residents in a post COVID-19 landscape, with keyless entry to the apartments as well as smart home features. Hand sanitizing stations and antimicrobial surfaces will be installed throughout the shared spaces, while community bathrooms will provide hand-free amenities such as contactless faucets and soap dispensers. It will offer a mix of studio, one-, and two-bedroom apartments with separate work and living areas for residents to work from home efficiently as well as outdoor recreational spaces. It also is adjacent to the McKalla Place Major League Soccer Stadium, which is slated to open in spring 2021.
“Despite COVID-19, Austin continues to be an attractive technology, business, government, and investment hub with a steady outlook, an ideal base for CapitaLand to scale our multifamily portfolio in the U.S.,” said Dang Phan, managing director for USA, CapitaLand International.
“Austin’s business-friendly policies, high quality of life, and skilled workforce have attracted major technology and internet companies such as Amazon, Apple, Google, IBM, Oracle, and Tesla to set up substantial operations in the city. The city’s focus on technology has also fueled its population and job growth, consistently outpacing the national average. The demand for quality housing has risen correspondingly, with rents increasing 50% over the past decade.”
CapitaLand is one of Asia's largest diversified real estate groups, with a portfolio spanning across retail, business parks, industrial, lodging, and residential. It has a presence across more than 220 cities in more than 30 countries, with a focus on Singapore and China as its core markets and continued expansion in markets such as India, Vietnam, Australia, Europe, and the U.S.
In 2018, the firm acquired a portfolio of 16 multifamily communities in the U.S. for $835 million, marking its foray into the asset class. The 3,787 units are located in suburban communities in Denver, Greater Los Angeles, Portland, Oregon; and Seattle.
“Development is one of CapitaLand’s key strategic growth pillars, along with lodging and fund management. CapitaLand’s acquisition of this prime site to develop our first multifamily property in Austin and having a potential pipeline of projects in the Southeast and Southwest markets of the U.S. will accelerate CapitaLand’s growth in the resilient multifamily sector,” said Jason Leow, president, Singapore & International, CapitaLand Group. “It adds to our current portfolio of 16 freehold suburban multifamily properties that we acquired in 2018, strengthening CapitaLand’s presence and track record in the market. We will continue to seek attractive investment opportunities to build upon our diversified and well-balanced portfolio to deliver long-term value for our stakeholders.”
