Regional Apartment Players Hunt Deals

Wall Street Journal (05/28/08) P. C12; Timiraos, Nick
Credit may be scarce in many property sectors, but financing is still available for acquiring apartment communities thanks to Fannie Mae and Freddie Mac--two government-sponsored enterprises that have a mandate to provide market liquidity for affordable housing and also see multifamily housing deals as a source of profit in an otherwise bleak market. Meanwhile, competition facing such regional investors as Berkshire Realty Group LLC has significantly diminished as the major players that previously ruled the multifamily housing sector are no longer driving the dealmaking activity. The apartment sector has held up favorably when compared with the broader real estate landscape; Real Capital Analytics reports that retail and office sales fell by 70 percent and 80 percent, respectively, in this year's first quarter from the same period a year ago versus a 40-percent dip in multifamily sales. The demand for rental apartments also remains healthy from would-be home buyers unable to get mortgages and homeowners forced out in foreclosures. According to Reis Inc., apartment rents posted a solid 1-percent gain during the first three months of this year.