Essex Property Buys JV Partner's 49.9% Stake In BEXAEW Portfolio For A $505 Mln

(RTTNews) - Essex Property Trust, Inc. (ESS) said on Monday that it has acquired its joint venture partner's 49.9% interest in the BEXAEW portfolio for a $505 million on a gross basis.

The portfolio is comprised of four properties totaling 1,480 apartment homes.

"The seller's cap rate is approximately 5.25%; however, after incorporating additional economic benefits by fully integrating this portfolio into our operating platform, we estimate a 5.9% year-one yield," Essex said.

Concurrent with closing, the company repaid $219.9 million of debt encumbering the properties and consolidated the communities on its financials.

The portfolio generated an 11.4 percent IRR and the buyer will recognize around $1.5 million in promote income, which will be excluded from core FFO.