Two Multi-Housing Industry Leaders Launch Company to Acquire, Renovate 7,000 Units

Jeff Adler, former chief property operations officer at AIMCO and Jack Kern, former investment research director at Archstone-Smith and vice chair of the NMHC Research Committee, have formed a new multifamily investment vehicle, Sanctuary Multifamily Advisors.

The asset management firm, one of Sanctuary Group’s companies, which Adler formed in October 2008 after departing AIMCO, plans to initially acquire and renovate 5,000 to 7,000 units in Denver, San Diego and Orange County, Calif.

“Our concept all along has been to marry a solid quantitative foundation in investment analysis with moderate leverage and a passion for the customer experience to generate superior investment returns,” says Adler. “We’re now in a position to deliver on that mission, starting with these three markets, which we believe have limited downside risk and great upside potential.”

The venture has targeted post-1990 low- to mid-rise apartment communities of over 100 units in need of their first major rehabilitation, along with operationally or financially distressed properties. A separate investment opportunity is newly constructed product that has failed to achieve underwritten rents and requires an immediate all cash exit strategy.

“We believe that the next 12 months represent a significant opportunity to enter select markets at reasonable price levels. Three years from now, people will be kicking themselves for not having bought now,” says Adler. “Yes, there may be the occasional distressed asset, but most properties are not going to be distressed, and there are a lot of owners looking for a reasonable exit,” says Adler.