J.P. Morgan analyst Anthony Paolone backed UDR's $2 billion joint venture with Apollo, which puts 19 properties and 7,059 units into the structure at a 6% cap rate with average revenue per unit of $2,058 and average property age of 39 years. UDR keeps a one third stake, continues managing operations, earns a 1.25% asset management fee worth $16.75 million a year and nets about $119 million in cash proceeds, with an option to buy back Apollo's stake at year five.
Why it matters to multifamily marketers
Watch for similar REIT and institutional joint ventures in your market because new ownership structures often trigger a brand refresh, new property management or renewed marketing spend at the acquired communities.