Waterton Re-Enters the Las Vegas Multifamily Market

Chicago-based national investor Waterton has re-entered the Las Vegas multifamily market after two years. The firm has acquired a two-property, 720-unit apartment portfolio, its first acquisition after exiting the market two years ago. Waterton sees opportunity in the Las Vegas market and strong growth potential late in the cycle.

“Las Vegas is attracting job growth and population growth at incredibly strong levels,” Peter Kuzma, VP of acquisitions of Waterton, tells GlobeSt.com. “The market is a late cycle demand generator and with the beneficial tax structure, should continue to attract and retain households over the near term.  While Las Vegas has been, and still very much is, a gaming and hospitality driven market, the market is slowly diversifying, creating defensive strength for future downturns.”

The two properties include Mirasol and Fairways on Green Valley. Mirasol is located on 22 acres at 2180 E Warm Springs Rd. in Las Vegas and has 400 apartment units in 50 two-story garden-style buildings with a clubhouse, fitness center, dog park and pool. Fairways on Green Valley is located on 16 acres at 1851 N Green Valley Pkwy., Henderson. It has 320 units in 39 two-story garden-style buildings with a welcome center, clubhouse, recreation center and pool.

Waterton sold its last Las Vegas asset in June 2017; however, growing demand and housing affordability have driven the investor back to the market. Its strategy is to buy properties with value-add potential. “Waterton is attracted to markets and submarkets with high demand potential and affordable rent-to-income dynamics,” says Kuzma. “Value-add potential further creates an opportunity for us to enhance yields with the goal of maintaining long-term affordability. Discount to replacement cost is also a key factor for Waterton.  Las Vegas is a market that represents those characteristics well.”

These two assets align with Waterton’s value-add strategy. The firm plans to enhance the property through capital improvements. “Both properties fit Waterton’s investment strategy as they are a discount to replacement cost, present an opportunity to enhance revenue through capital renovations and represent a post-renovated, affordable housing option in quality submarkets,” adds Kuzma.

This will likely be the first of more acquisitions for the firm over the next 12 to 24 months, although Kuzma wouldn’t be specific about its acquisition goals. “This transaction marks Waterton’s return to the Las Vegas MSA since exiting several years ago,” he says. “Acquiring 720 units is a great first step, but we hope to judiciously build on the footprint over the next 12-24 months.”