Near full employment and a rainy winter is good news for Orange County workers and trees, but not as beneficial for one of the country’s largest apartment owners.
Highland Ranch, Colo.-based UDR Inc. (NYSE:UDR), which had about 13% of its total rental portfolio—about 5,000 units—in OC at the end of the year, pointed to the area as one of its poorer performing sectors last quarter.
Orange County “has had slower job growth,” Chief Operating Officer and President Jerry Davis told analysts last month, during the $12.4 billion-valued apartment investor’s quarterly earnings call.
Job growth here “is projected to pick up a little bit. We’ll see how strong that comes in,” Davis said.
The other thing that affected UDR in the first quarter in OC and other West Coast markets “was extreme rain events, [it] kept traffic down,” he said.
UDR’s portfolio in OC was about 92% leased at the start of this year, compared to 95% for its companywide portfolio of nearly 40,000 units.
The company’s recent disappointment in the region hasn’t stopped it from investing here.
Earlier this year, UDR exercised an option to buy out its partner’s interest in Anaheim’s Parallel apartment complex, a 386-unit project in the Platinum Triangle that opened last year.
It bought the 51% stake in the community from Scottsdale, Ariz.-based Wolff Co., paying $33.5 million in cash, plus the repayment of $59.8 million in construction-related debt.
The deal for the complex along Katella Avenue, a few blocks from Angel Stadium, values the property around $480,000 per unit.
