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| Joanna Zabriskie of BH Management Services, LLC, a management firm at the marcus evans European Pensions & Investments Summit 2015, on how the apartment sector differs from other real estate sectors. |
LONDON, May 22, 2015 - (ACN Newswire) - "Resident demand has never been stronger for apartment homes in the US due in large part to demographics. The apartment industry is a stable place to allocate real estate capital," according to Joanna Zabriskie, President, BH Management Services, LLC.
"The apartment sector has proven to be the most reliable generator of stable cash flow and capital preservation as compared to retail, office or industrial. During the economic downturn in 2008 - 2009, the national average apartment occupancy rate dipped to 91 percent - a sustainable level with appropriate leverage. The apartment industry was also the first to recover and grow occupancy in 2010 - even prior to job growth recovery. Compared to that, in 2009 office vacancies rose to 18 percent," she highlights.
BH Management Services, LLC is a management firm at the marcus evans European Pensions & Investments Summit 2015 in Montreux, Switzerland, 8 - 10 June.
- What demographic changes make apartments an attractive sector to invest in?
While immigration is a continual source of new renters, 77 million millennials are moving out of their parent's homes, many saddled with college debt, and putting off marriage and home ownership. They want mobility to relocate for new jobs.
At the same time, 75 million baby boomers are moving into retirement and selling their larger homes to relocate to more flexible apartment communities - near public transportation for active, city lifestyles. This is pushing apartment rentals and occupancy up to the mid-90s percentile, as well as increasing effective rents. These trends will not change over the next ten years.
- How does the apartment sector compare against other real estate sectors?
Apartments is a "basic needs" industry, everyone must live somewhere but they do not need to shop (retail), go on vacation (hotels) or expand their workspace (office or industrial). Apartments do not have large blocks of tenants vacating simultaneously, and can reset rents on an annual basis. This allows us to react appropriately to market and inflation cycles - adjusting with each lease.
- What locations do you focus on? Why?
Our focus is on locations in urban and strong suburban areas that do not have new supply. Capital preservation is very important for our investment partners, so we look for locations with strong employment drivers and good public transportation.
We renovate the communities, add state of the art business or community centers, outdoor kitchens, cyber cafes or fitness centers, to provide value to residents. This helps us increase rents, cash flow and exit value.
Much of the industry today is focused on the coastal cities, such as San Francisco or DC. While we do invest in those cities, we also see value in the Midwestern major metropolitan markets, Chicago or Minneapolis for example. We do not just acquire properties where everybody else does, but look for strong markets with a good employment story, so we can renovate and operate better than anyone else in the marketplace.
- Any final words of advice?
Choose a well-seasoned, experienced investment partner. Make sure that their investment strategy and methodology are in alignment with the pension fund's investment goals. BH has been in business through many different cycles and has seen the good parts of the multi-family industry as well as the bad parts, and operated well through them.
About the European Pensions & Investments Summit 2015
The 15th annual European Pensions & Investments Summit is the ultimate meeting point, bringing elite buyers and sellers together. The Summit offers regional pension investors and international fund managers and consultants an intimate environment for focused discussion of the key new drivers shaping institutional asset allocations. Taking place at the Fairmont Le Montreux Palace, Montreux, Switzerland, 8 - 10 June 2015, the Summit includes presentations on capturing attractively valued investments, increasing fund resilience, tail risk management and making responsible investing a reality.
For more information please send an email to press@marcusevanscy.com or visit the event website at www.epi-summit.com/JoannaZabriskieInterview
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The Investment Network - marcus evans Summits group delivers peer-to-peer information on strategic matters, professional trends and breakthrough innovations.
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Please note that the Summit is a closed business event and the number of participants strictly limited.
About BH Management Services, LLC
Founded in 1993, BH Management Services, LLC has grown to become one of the largest multi-family management firms in the nation, overseeing more than 60,000 apartments. The company and its 1,500 plus employees manage more than USD 3.6 billion of properties in 21 states, ranking it 12th on the National Multi-family Housing Council's Top 50 Management Companies in 2015. Through in-depth market and real estate knowledge, an industry-leading design and development program, and a top-level property management team, BH acquires, repositions and operates properties to maximise value for its residents, owners and employees. BH manages Class A and B apartment communities with a focus on being an elite company in its services, technology and team members. The company's corporate headquarters are located in Des Moines, Iowa, with regional management offices in Dallas and Houston, Texas, Atlanta, Georgia and Chicago, Illinois. www.bhmanagement.com.
Contact:
Sarin Kouyoumdjian-Gurunlian
Press Manager, marcus evans, Summits Division
Tel: +357 22 849 313
Email: press@marcusevanscy.com
Topic: Trade Show or Conference
Source: marcus evans Summits
Sectors: Daily News
https://www.acnnewswire.com
From the Asia Corporate News Network
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