AIR Communities Discloses Two Joint Ventures With Combined Value Of $1.2B

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  • Apartment Income REIT Corp AIRC has formed joint ventures, with two real estate investors, to recapitalize 11 properties.
  • AIR will hold a 53% stake in the first joint venture and a 30% stake in the second joint venture, in the arrangement.
  • The 11 properties are valued at an aggregate of $1.2 billion based on a trailing twelve-month NOI cap rate of 5.6%.
  • AIRC will receive proceeds totaling $600 million, while asset and property management fees are anticipated to provide annual margins of $2.5 million.
  • The ratio of AIR's total debt to EBITDA will be less than 6:1 after the transactions are complete, opening up the possibility of accretive acquisitions.
  • Each partner has also agreed to invest with AIRC in upcoming acquisitions, with one partner concentrating on value-add opportunities and the other on core opportunities.
  • Paul Beldin, Chief Financial Officer of AIR, commented: "AIR's total indebtedness to ebitda was temporarily elevated at the end of our first quarter due to the January 2023 acquisition of Southgate Towers. These transactions reduce total indebtedness to within our targeted range and were contemplated in AIR's full year FFO guidance. They are therefore neutral to expectations for the year."
  • Price Action: AIRC shares are trading higher by 0.53% at $35.90 on the last check Tuesday.
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