Real estate private equity investor Mountain Real Estate Capital closed on eight investments in the second quarter.
“2014 continues to be another growth year for Mountain and our partners,” says Peter Fioretti, Mountain’s chief executive. “Our largest investment was providing additional equity to existing partner, Oakwood Homes, to acquire one of Utah’s largest builders, Henry Walker Homes. This included over 1,200 lots and 400 acres in 40 communities. Since our first investment with Oakwood in 2012, they have grown from approximately 300 closings a year to over a 1,000 closings projected in 2014, which will make them one of the top 50 builders in the country.”
Mountain committed USD145 million to acquire a total of 3,000 lots and a 1,000 acres to be developed in eight states.
“We continue to be excited about the diversity of our portfolio and the repeat business with our existing partners,” says Joel Kaul, Mountain’s managing director who oversees a majority of the builder/developer relationships for the company.
“We recently closed on our 10th subdivision with one of our Midwest builder partners, our sixth deal with one of our west coast builder partners and our 12th transaction with our builder partner in New York City.
“Over 90 per cent of our investment portfolio has funded developer/builder partners with an investment programme for repeat deals or a platform/entity investment.”
In addition to the firm’s existing builder partners, Mountain is developing and selling lots to another 30 top 200 builders in our master plan communities and larger land projects across the country. Mountain is structuring these sale transactions to deliver pods or lots to builders with the most desirable structure for both parties. In many instances, Mountain is providing structured takedowns or option contracts over a couple of years.
“Not only did we have another solid quarter but our pipeline for repeat business also remains strong,” says Fioretti. “We project that we will invest over USD100 million in the third quarter. As the industry participates in the economic recovery we will expand to select markets around the country.”