MFE Top 50 Preview: The Top 5 Developers of 2012

An explosive year of new development set the stage for a few shakeups on Multifamily Executive's Top 50 builders list.

Greystar Real Estate Partners topped the list as the largest mover and shaker of the year. The Charleston, S.C.-based company climbed from No. 13 last year to the top spot with 5,360 new starts in 2012, a 164 percent rise over its 2011 volume. The firm attributes the year-over-year surge to its careful sense of deliberation: Greystar waited to make deals until the time was right in the wake of the economic downturn, says executive director of development Scott Wise.

“It was really at the end of 2010 that the signals began pouring in,” Wise says. “Most of our 2012 starts originated from that turning point for us.”

That pacing laid the groundwork for an epic year. Wise says he was surprised the company rose to the very top, as he expected Wood Partners, No. 2, and Mill Creek Residential, No. 3, to take the prime spots.

Dallas-based Mill Creek Residential climbed this year’s list by putting 5,001 new units in motion, an 88 percent increase in starts as compared to its 2011 production. However, it wasn’t enough to outshine last year’s alpha dog, Atlanta, Ga.-based Wood Partners, which started 5,082 units in 2012, a 36 percent increase from the firm’s 2011 count.

All three companies reported they don’t believe this coming year will be earthshattering compared with the numbers posted in 2012. Each predicts it will have similar numbers to those in 2012. In fact, despite the growing demand, the production numbers may shrink some in 2013 given the rising costs of labor and materials.

“The numbers may even be a little less,” Wise says. “Land and construction prices have risen, but as a nation, we’re still underfulfilled as far as supply.”

Taken as a whole, the hefty amount of starts in 2012 proves construction is back in full swing as developers race to capture a growing wave of demand.

There were 233,900 new multifamily units built in 2012, according to the National Multi Housing Council (NMHC). This is up by 66,000 units over the previous year and up more than 129,000 units from 2010, according to NMHC data pulled from the Census Bureau. Still, last year’s number of starts remained below the historical average of 300,000 new units annually--though at this pace, it won’t be long before the industry hits that mark again.