Pipelines are Not as Crowded in HUD Program
Growth is strong in most multifamily markets in Texas, but the cost of construction is currently outpacing rents which has to change in order for opportunities to become obvious in the larger markets.
COLLEGE STATION, TX—Plans for a 272-unit market-rate project are underway to develop a multifamily project in close proximity to Texas A&M University, within one of the fastest-growing metros in the nation. Lynd, along with its partner TR Inscore, are teaming up to develop the apartment community, Ranch at Arrington.
“This is no longer just a college town–the city is thriving with a diversified economy and extremely low unemployment,” said A. David Lynd, president and CEO of Lynd.
Construction is expected to commence later this month. Located on 12 acres at 1650 Arrington Rd., the Ranch at Arrington will have a mix of one-, two- and three-bedroom apartments in two- and three-story buildings.
The project marks a return to development work for Lynd. While the company has several new development projects in the pipeline, Ranch at Arrington marks the first to move forward since Lynd took over as president and CEO earlier this year. In this exclusive, he recently discussed Lynd’s development platform, its strategy and market forecast.
GlobeSt.com: Why did Lynd decide to restart its development platform?
Lynd: When my brother left the family business last year, he was the most active member of the family doing development deals. However, I was the lead developer from our company when we built our first high-rise in Chicago called EnV nearly 10 years ago. It won numerous awards and for several years, set the record for highest price paid on a per-door basis in the city. As our company grew, our responsibilities shifted internally and mine became focused on acquisitions of debt, stabilized assets and repositioned assets. These included the acquisition of the John Hancock Tower and nearly $1 billion in multifamily assets.
This year when I became CEO of Lynd, one of my main priorities was to return to our development work. In fact, we recently added several people to our development platform to source and manage deals. We now have a solid team in place to implement our plan and continue with the strong tradition of building first-class apartment communities.
GlobeSt.com: What is your development strategy moving forward?
Lynd: Our strategy is to develop in smaller markets utilizing HUD’s 221(d)(4) program where the pipelines are not as crowded. We will always maintain a pipeline in higher-barrier-to-entry markets like Portland, for example, but we will not chase yields downward just to do a deal.
GlobeSt.com: Will there be more projects planned for Texas? What else do you have in the pipeline?
Lynd: We are currently processing several sites through the HUD program in Texas and should be in a position to announce those shortly.
GlobeSt.com: What do you see on the horizon for the multifamily market in Texas?
Lynd: Growth is strong in most markets in Texas, but the cost of construction is currently outpacing rents. That has to change in order for opportunities to become obvious in the larger markets here.
In addition to its property management business, Lynd has had a history of investing in and developing apartment communities throughout Texas, Illinois and Florida.
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