DENVER--(BUSINESS WIRE)--UDR, Inc. (the "Company") (NYSE: UDR), a leading multifamily real estate investment trust, today announced that it has entered into a definitive agreement with the Witkoff Group to acquire 10 Hanover Square, a 493-home apartment community in New York City’s thriving Financial District, for $260.8 million. The purchase price will be funded through the assumption of an existing $192.0 million fixed rate mortgage, the issuance of approximately $64.3 million of operating partnership units (with a floor price of $25 per unit) and approximately $4.5 million in cash.
“The expansion of our portfolio into Manhattan reflects our desire to own and operate apartment homes in markets that have the best growth prospects based on favorable job formation and low home affordability,” said Tom Toomey, president and chief executive officer of UDR. “With total revenue per home of $3,000 per month and only six years following the completion of a major redevelopment, the acquisition of 10 Hanover Square will further enhance the overall quality of our portfolio.”
Located between Water Street and Pearl Street, the 23-story building was formerly the corporate headquarters of both Goldman Sachs and Kidder Peabody prior to being renovated in 2005 to a residential tower offering condominium-style finishes and amenities. The building’s studio, one-, two- and three-bedroom apartments, averaging 708 square feet, feature nine-foot ceilings, open floor plans, granite countertops, maple cabinets and solid oak wood flooring. Residents enjoy 24-hour concierge service, two lounges, a rooftop deck and a discounted membership to Xtreme Gym New York, the 28,000-square-foot on-site fitness center.
10 Hanover Square also contains 41,650 square feet of retail space that is fully leased by Xtreme Gym New York, Fresco on the Go Restaurant, The Original Soupman Restaurant, Apple Bank and Starbucks. The Company estimates the purchase price, excluding retail, at $484,000 per apartment home.
“We are extremely pleased to reach an agreement whereby UDR will acquire 10 Hanover Square, a building located in an area that continues to see significant transformation since we began the conversion of the building from vacant office space to a desirable apartment building,” said Steven Witkoff, chief executive officer, of the Witkoff Group. “Our decision to receive nearly all of our equity in the form of operating partnership units in UDR confirms our beliefs in the management team and their ability to create significant long-term value for its shareholders.”
The Company anticipates that the closing will occur following the assumption of the $192 million mortgage and the satisfaction of customary closing conditions. The fixed-rate mortgage has an all-in rate of 5.93% and requires interest only payment through December 2012 and matures in December 2015.
Forward Looking Statements
Certain statements made in this release may constitute "forward-looking statements." Words such as "expects," "intends," "believes," "anticipates," "likely," "will," "seeks," "estimates" and variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements, by their nature, involve estimates, projections, goals, forecasts and assumptions and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in a forward-looking statement, due to a number of factors, which include, but are not limited to, unfavorable changes in the apartment market, changing economic conditions, the impact of inflation/deflation on rental rates and property operating expenses, expectations concerning availability of capital and the stabilization of the capital markets, the impact of competition and competitive pricing, acquisitions, developments and redevelopments not achieving anticipated results, delays in completing developments, redevelopments and lease-ups on schedule, expectations on job growth, home affordability and demand/supply ratio for multifamily housing, expectations concerning development and redevelopment activities, expectations on occupancy levels, expectations concerning the Vitruvian ParkSM development, expectations concerning the joint venture with MetLife, expectations that automation will help grow net operating income, expectations on annualized net operating income and other risk factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time, including the Company's Annual Report on Form 10-K and the Company's Quarterly Reports on Form 10-Q. Actual results may differ materially from those described in the forward-looking statements. These forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this presentation, and the Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in the Company's expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required under the U.S. Securities Law.
This release and these forward-looking statements include UDR’s analysis and conclusions and reflect UDR’s judgment as of the date of these materials. UDR assumes no obligation to revise or update to reflect future events or circumstances.
About UDR, Inc.
UDR, Inc. (NYSE:UDR), an S&P 400 company, is a leading multifamily real estate investment trust with a demonstrated performance history of delivering superior and dependable returns by successfully managing, buying, selling, developing and redeveloping attractive real estate properties in targeted U.S. markets. As of December 31, 2010, UDR owned or had an ownership position in 59,614 apartment homes including 930 homes under development. For over 38 years, UDR has delivered long-term value to shareholders, the best standard of service to residents, and the highest quality experience for associates. Additional information can be found on the Company's website at www.udr.com.