Essex Property Trust acquires JV partner’s interest in BEXAEW portfolio for $505m

Essex Property Trust has acquired its joint venture partner’s 49.9 percent interest in the BEXAEW portfolio for a total purchase price of $505.0 million on a gross basis.

The seller’s cap rate is approximately 5.25 percent; however, after incorporating additional economic benefits by fully integrating this portfolio into the trust’s operating platform, Essex estimates a 5.9 percent year-one yield. Concurrent with closing, the company repaid $219.9 million of debt encumbering the properties and consolidated the communities on the company’s financials. The portfolio comprises four properties totaling 1,480 apartment homes. The portfolio generated an 11.4 percent IRR, and the company will recognize approximately $1.5 million in promote income, which will be excluded from core FFO.