LaSalle Acquires Value-Add Multifamily Asset in Austin
CHICAGO (March 14, 2018) — LaSalle Investment Management (“LaSalle”), announced that its U.S. value-add fund LaSalle Income & Growth Fund VII (“Fund VII”) has acquired, Lakeshore Pearl, a 230-unit garden-style multifamily asset located in the East Riverside submarket of Austin, Texas, through a joint venture with Cypress Real Estate Advisors.
This acquisition presented a unique opportunity to work with an experienced local developer/operator on a high-quality product with an attractive unit mix in a fast-growing region that is characterized by exceptional demographic and migration trends.
Built in 2013, Lakeshore Pearl is located in the East Riverside Corridor, a city-planned redevelopment initiative aimed at transforming the south lakefront into a more urban, pedestrian friendly environment. The asset has the potential for significant upside as Oracle, one of the area’s top employers, nears completion of Phase 1 of what will be a one million square foot cloud computing campus on the parcels that surround Lakeshore Pearl, which is expected to house up to 5,000 employees. Lakeshore Pearl is situated less than three miles from Austin’s Central Business District, the area’s largest employment hub. Residents are also drawn to this high-growth corridor due to its proximity to major transportation thoroughfares.
Joe Munoz, Chief Investment Officer for LaSalle’s Income & Funds, commented, “We are pleased to add Lakeshore Pearl to the Fund VII portfolio. This transaction presents us the opportunity to incorporate a high-quality multifamily asset located in a desirable submarket of Austin. With our proven redevelopment platform, Lakeshore Pearl offers the potential for significant upside, especially as Oracle continues its expansion and consolidates ownership of Austin’s Lakeshore District.”
Adam DeBoey, Senior Vice President of Acquisitions at LaSalle stated, “This high-performing multifamily property offers residents superior access to Austin’s key destinations and employers. The East Riverside Corridor is experiencing improvements to both infrastructure and amenities, and is immediately accessible to the vibrant South Congress neighborhood and East Austin, while offering rents that are 25% below new high-rise buildings in the central business district. We are well-positioned to execute our redevelopment and modernization plans, which coincide with Oracle’s expanding presence, which is expected to drive demand and support rent growth.”
The Austin MSA is a fast-growing region with a population of two million residents, and showed growth of 37.3% from 2000-2010 and 16.5% from 2010-present. The significant population increase translates to roughly 157 new residents per day. The city’s population is projected to grow at 2.62% a year through 2021. In addition, since 2005, the Austin employment base has increased by more than 35%, which is the highest among all U.S. MSA’s during that timeframe. The impressive job growth can be largely attributed to the low cost of doing business in Austin, which is one of the most business friendly environments in the nation. The south east central apartment market caters well to the millennial demographic employing over 86,000 individuals and offers several hundred restaurant and shop options.
About LaSalle Income & Growth Funds
The LaSalle Income & Growth funds are the firm’s flagship closed-end U.S. value add fund series, with the first fund in the series launched in 1996. Aggregate fund series capital commitments total $2.6 billion, with over $5.7 billion invested in over 98 property investments across all funds in the series. Fund VII seeks to acquire under-managed, under-capitalized, or mispriced assets to be repositioned as core assets. Property level-investment strategies include lease-up, renovation/repositioning and ground-up development. Fund VII began acquiring assets in 2016.
About LaSalle Investment Management
LaSalle Investment Management, Inc. (together with its global investment advisory affiliates, “LaSalle”) is one of the world’s leading real estate investment managers. LaSalle on a global basis manages approximately $58 billion as of Q4 2017 of private and public equity and private debt investments. LaSalle’s diverse client base includes public and private pension funds, insurance companies, governments, corporations, endowments and private individuals from across the globe. LaSalle sponsors a complete range of investment vehicles including separate accounts, open- and closed-end funds, public securities and entity-level investments. LaSalle Investment Management, Inc. is a wholly-owned, operationally independent subsidiary of Jones Lang LaSalle Incorporated (NYSE: JLL), one of the world’s largest real estate companies. For more information please visit www.lasalle.com.
This information is based on the market analysis and expectations of LaSalle and should not be relied upon by the reader as research or investment advice regarding LaSalle funds or any issuer or security in particular. The information presented herein is for illustrative and educational purposes and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy in any jurisdiction where prohibited by law or where contrary to local law or regulation. Any such offer to invest, if made, will only be made by means of a private placement memorandum. Past performance is not indicative of future results.