(To read more on the multifamily market, click here.)
BETHESDA, MD-LCOR, a Berwyn, PA-based development firm, and the California State Teachers' Retirement System are increasing their combined equity commitment in a joint venture formed last year to develop and acquire multifamily assets on the East Coast to $287.5 million. When leveraged with debt, the equity will allow the venture, called LCOR Residential Associates LLC, to complete multifamily investments of up to approximately $1 billion.
One conceivable use for the additional funding is further investment in the three remaining phases of North Bethesda Center, R. William Hard, executive vice president of LCOR, tells GlobeSt.com. The first phase, which was backed by LCOR Residential Associates' original funding, has closed.
North Bethesda Center is a mixed-use commercial and residential development situated on a 32-acre site owned by the Washington Metropolitan Area Transit Authority. It is next to the White Flint Metrorail station. LCOR is the master developer of the site.
The first phase of development includes an 18-story, 312-unit rental apartment project and a 65,200-sf grocery store. The total construction cost is approximately $110 million. There are an additional 900 units in the three remaining phases, Hard says, which the company would consider developing with its new financing. The center will ultimately include more than one million sf of office space, 202,000 sf of street-retail space, and 1,250 multifamily units.
Hard adds that the company is also actively looking for other investment opportunities that fit with the JV's original mandate. The company considers both development and acquisitions, but focuses on condo conversions and redevelopments in Washington, DC as well as Philadelphia, New York City and other East Coast markets. "We see a lot of opportunities in these markets and decided that now was a good time to increase our equity commitment."
LCOR Residential Associates LLC has made two other investments with its original $100 million in equity. In June 2005 it purchased a New York City site to develop a 191-unit, 21-story high-rise condominium in Murray Hill called the Charleston. In December 2005, it acquired Ravens Crest, a 444-unit garden apartment community in Manassas, VA. LCOR's relationship with CalSTRS dates back to 2003, when the organizations first invested together to develop Wilton House, a 259-unit, 15-story high-rise residential property near Tysons Corner.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
