The Related Group is making another push into multifamily real estate.
Related and Rockpoint Group are launching a new division within Related focused on acquiring value-add multifamily properties in Florida and throughout the Sun Belt, the companies announced on Tuesday.
Together, they plan to spend more than $2 billion over the next several years. Miami-based Related and Boston-based Rockpoint are focusing on Florida and major markets that include Atlanta, Dallas and Phoenix.
Related first expanded to the Southwest with a satellite office in Dallas late last year. The company said at the time that it would initially focus on multifamily ground-up development in Phoenix, Denver, Las Vegas and major Texas markets. The move marked another sign of diversification for Related, which is expanding further into the multifamily sector.
Related has since opened another satellite office in Atlanta and is likely opening others in Phoenix and Las Vegas.
Michael Hammon, previously chief development officer of Ram Development Company, returned to Related this month to work on the new division with Matt Allen, Related’s chief operating officer. They will acquire, renovate and manage a portfolio of income-producing apartments.
“Both Jorge Perez and Matt Allen had been approached numerous times …’Why aren’t you in this business?’” Hammon said. “I think they just both feel very strongly about U.S. real estate, especially the multifamily sector. We’ve done rehabs in the past. This is more of an expansion into a slightly different line of business.”
Hammon said the new division is looking at deals in the $60 million to $100 million-plus range, and will use Related’s property management, construction and development arms. Related and Rockpoint plan to hold the properties for about three to seven years, with exceptions.
The partnership isn’t the first time Related works with Rockpoint. Rockpoint, a private equity firm and investment adviser, joined Related on condo projects that include Brickell Heights and Residences by Armani Casa. Last year, Related sold the Town at Pembroke Pines apartments to Rockpoint for $87 million.