Passco Cos. has hit a total of $3.5 billion in total multifamily transaction volume. The milestone positions the company as a major multifamily player, and Passco plans to continue to grow the platform. The firm currently holds a portfolio of $2.6 billion in multifamily assets.
“Over the past several years, we’ve been focused on acquiring best-in-class assets in suburban submarkets that are experiencing strong population and job growth, as well as boast exceptional school systems—and in many cases, limited delivery pipeline due to high barriers to development,” Gary Goodman, SVP of multifamily acquisitions at Passco, tells GlobeSt.com. “This was in part because we anticipated that many Millennials would not necessarily be able to buy a home in the near future, but still desired a high quality of living and amenities.”
Originally a retail-dominant investor, the firm began focusing on multifamily assets in 2005 as a result of increasing demand for multifamily and decreasing demand and performance of retail assets. “This forward-thinking redirection not only preserved Passco’s profitability through the recession, but also greatly expanded our national presence,” says Goodman. “While we acquire throughout the country, our multifamily portfolio has been bolstered significantly by our activity in the Southeast in recent years. Our strategic focus and relationships resulted in Passco adding over $1 billion in multifamily product in that region alone since 2015.”
The firm’s rapid success is impressive, considering they haven’t been the only investor to ramp up multifamily activity this cycle. “It is no secret that competition has increased significantly within the multifamily market, especially as more and more investors target suburban secondary and tertiary markets—where we’ve transacted for the better part of a decade,” says Goodman. “That said, because the Passco team has been active in these markets for so long and has established deep broker and developer relationships, we are well-positioned to continue to secure increasingly rare yet highly lucrative opportunities this year. Additionally, we are able to move quickly since we are purchasing all cash on our balance sheet, and we do not require outside investors to close.”
As part of its growth, Passco also plans to grow its ancillary multifamily service platforms, including asset management. “We are focused on further optimizing our multifamily asset management strategy and continuing to strengthen our excellent relationships with Passco’s property management partners,” says Goodman.
Looking ahead, Passco plans to continue to grow its multifamily portfolio and will focus on value-add deals and ground-up development. “Passco remains highly focused on the multifamily sector and staying ahead of the curve,” says Goodman. “We’ll continue to expand our multifamily portfolio and acquire exceptional, newly constructed assets in high-quality locations. Regionally, in addition to the Southeast, we are particularly bullish on Texas and Western submarkets.”