Greystar is a leading, fully integrated real estate company offering expertise in investment management, development, and construction services in institutional-quality rental housing, logistics, and life sciencessectors. HeadquarteredinCharleston,SouthCarolina, Greystar manages and operates more than $320bn1 of real estate in 2511 markets globally with offices throughout North America, Europe, SouthAmericaandtheAsia-Pacificregion. Greystaristhelargest operator of apartments in the United States, manages ~997,0001 units/beds globally, and has a robust institutional investment management platform comprising more than $78bn1 of assets under management, including over $15bn of assets under development. Greystar was foundedbyBobFaithin1993tobecomeaproviderofworld-class service in the rental residential real estate business. To learn more, visit www.greystar.com.
¹ Key Metrics are as of the end of Q2 2024.
Sector forecasts
INDUSTRIAL:
Greystar’s logistics outlook remains favourable globally. Despite the e-commerce industry’s rapid growth over recent years, increasing online sales and the share shift to online shopping experiences has continued as consumers recognise its value proposition. The expansion has highlighted the need for technically capable big box regional distribution centres and last mile sites. Investors remain optimistic that there is additional room for growth as the sector institutionalises in some markets and begins that trend in others. Underlying these shifts are favourable fundamentals including increased consumer spending and the inclination toward supply chain robustness by stocking inventory as corporate strategies incrementally shift from a ‘just-in-time’ inventory model to a ‘just-in-case’ regime.
In particular, Australia is projected to benefit from strong population growth partially driven by a renewed focus by the Australian gov- ernment to expand immigration. A force that when combined with urbanisation, can lead to growing consumer spending in the nation’s major cities. The logistics sector desperately needs new supply as there is little space available and even less that would accommodate a logistics focused customer who needs to get product the ‘last mile’ to the consumer. Given Greystar’s positioning as a well-capitalised global developer and global investment manager, we believe it is a natural fit for the opportunity.
RESIDENTIAL:
Greystar’s outlook for residential housing remains constructive across global markets. Despite a softer macroeconomic environment, the long-term residential outlook remains positive as many developed markets continue to wrestle with supply-demand housing imbalances. These favourable tailwinds are further supported by population growth, urbanisation, and smaller households, requiring more efficient
land use and higher density housing that residential rental product offers. Concurrent with these demand drivers, global consumers increasingly prefer the flexibility and benefits provided by professionally managed multifamily and student accommodation such as on-site amenities and 24-hour services. Together, these secular trends have resulted in growing demand for rental housing globally.
The multifamily sector is gaining momentum in Asia Pacific given a variety of opportunities with different risk/reward profiles. In Australia, institutional investors have increasingly indicated interest in the Australian multifamily sector. Earmarked capital is likely interested in exposure to the strong supply and demand fundamentals, including population growth driven by continued in-migration and a broad housing shortage in the nation’s major cities, which has led to housing unaffordability becoming an increasing issue.
Affordability constraints in major Japanese cities continue to foster an increased propensity to rent. Namely, record condo prices and slowing supply could provide incremental demand for rentals in Greater Tokyo. Further, Japan remains one of the most liquid commercial property markets globally. Factoring the slight rise in interest rate recently, Japan offers an attractive yield spread for multifamily investments given the country’s low interest rate environment compared to other markets.
Investment principles & strategy
With over 30 years of experience investing in residential rental housing, Greystar has developed a successful investment approach focused on identifying and executing opportunities that seek to drive value at the property-level. Greystar believes that proven purpose-built rental design and operational excellence lead to a premium over market rents while offering security of income and a lower volatility outcome. Greystar continually seeks to deploy capital in markets with strong fundamentals while executing the investment strategies it has agreed upon with its capital partners. These strategies benefit from the company’s extensive information networks and relationships, including property management clients, lenders, developers and institutions to identify investment opportunities. Greystar’s vertically integrated, global platform is well-suited to source off-market opportunities and quickly analyse, underwrite and execute on single-asset acquisitions and developments, as well as large portfolios. Greystar believes that compelling opportunities typically include characteristics that fit within the following profile: (i) assets in attractive locations within high-barrier-to-entry submarkets in a strategy’s target markets that are poised for outperformance due to strong residential fundamentals; (ii) assets that exhibit potential for operational improvements leveraging Greystar’s property management expertise and scale; and (iii) assets that display upside potential through executing Greystar’s historically proven capital renovation programme.
The Asia Pacific Platform will seek to leverage Greystar’s scale and experience to drive value at the asset-level consistent with Greystar’s global value-add strategies, including its predecessor value-add and student housing investment strategies. Greystar’s value-add execution strategies include strategic deal sourcing via local teams with market expertise and strong networks, seeking to maximize value of assets through capital improvements, repositioning, and operational enhancements, providing purpose-designed products with a high level of amenities and services. The facets of Greystar’s value-add strategy, coupled with the benefits of a global platform, are expected to provide investors with an attractive opportunity in Asia Pacific resulting in strong risk-adjusted returns.
Strategic corporate development
Greystar has replicated its investment strategy from the United States over to selected cities in Europe, Asia Pacific and South America by building a blue-chip organisation with the aspiration to be the market leader of rental housing globally. In 2017, Greystar established an Asia-Pacific platform with the intention of becoming the pre-eminent, vertically integrated owner and operator of rental residential assets in the region. Greystar has established offices in China and Australia, where the multifamily supply and demand fundamentals are favourable and development of purpose-built multifamily provides an early mover advantage for returns that leverage Greystar’s 26+ year history in rental housing. Greystar opened its office in Tokyo in 2019 to take advantage of the largest established institutional multifamily market outside of the US.
Greystar’s investment process is supported with data from Greystar’s global portfolio and local market data from properties under management. Access to proprietary data enables Greystar to build operating budgets, evaluate investments and optimise property design with a high degree of accuracy, augmenting our investment capabilities. The local investment team has developed extensive relationships in the market that provide access to an attractive pipeline of investment opportunities. By leveraging Greystar’s vertically integrated platform, our local development and investment teams have extensive support resources across the Greystar platform.
Greystar expects to continue delivering industry leading service to its capital partners, clients and tenants it serves as it expands its Asia Pacific presence. Greystar’s investment management and development businesses are expected to grow as investors increasingly allocate capital to specialist operators in
an effort to mitigate sector risks and gain direct access to deep local market expertise. Greystar will continue to offer strategies across the risk spectrum and tailored to the needs of its partners and clients. The company has been keenly focused on building local platforms by exporting its culture and its investment management, development and operational expertise in the student, multifamily, corporate and senior housing market segments.
COMPLIANCE STATEMENT
The information contained in this document is provided as of the date below, unless noted. This document does not constitute an offer to sell or a solicitation of an offer to buy any securities. Any such offer/solicita- tion can only be made by the applicable offering documents furnished to qualified investors in jurisdictions where permitted by law. Any opinions, forecasts, projections or other statements, other than statements of historical fact, that are made in this document are forward-looking statements. Greystar gives no express or implied repre- sentation or warranty, and no responsibility is accepted with respect to the adequacy, accuracy, completeness or reasonableness of any information set out in this document, and nothing contained herein shall be relied upon as a promise regarding any future performance.