Atlanta multifamily investor plans to build apartments in Arizona, hires director of development
With a portfolio of more than 5,000 apartment units in Arizona, Atlanta-based Cortland now plans to build its own apartments in Phoenix and Tucson.
One of its first steps toward that effort is creating a director of development position for Arizona and hiring Ashley Nye to fill that role.
Nye left her role as development manager for Trammell Crow Co., where she managed the development of multifamily projects.
The Tucson native — who earned her master's in landscape architecture from Arizona State University after completing undergraduate work at University of Arizona — also previously worked at Point B as a landscape architect.
With 24 multifamily properties in Arizona, Nye said the goal is to double that over the next few years with a combination of ground-up development and continued acquisitions.
Cortland already has implemented this development strategy in some of its other markets, with six projects under construction in Florida and Colorado, and completed projects in Georgia, Texas and Alabama. It has a portfolio of more than 85,000 units.
"Arizona has seen a large influx in high quality employers relocating to the state, much to the credit of our amazing economic development teams and the natural beauty of the desert," she said. "We see that momentum continuing."
While Cortland hasn't purchased any land yet in the Valley — it is in the early stages of escrow for parcels in Phoenix and Tucson.
The first project to break ground will be in Tucson, she said.
What Cortland will build in the Valley
The company will focus on traditional vertical apartments and not the horizontal single-family, detached rental communities in the rapidly growing build-to-rent sector, she said.
"We continue to look for opportunities in submarkets undergoing growth — and many parts of the Valley are seeing that," she said, pointing to north Phoenix and the West Valley.
"These are some of the fastest-growing nodes for population in Phoenix," she said. "The East Valley — particularly Mesa — is a fantastic market and we're leaning into there as well."
Mike Altman, chief investment officer for Cortland who hired Nye for this new position, said Cortland takes a "boots on the ground" approach, especially when it comes to development.
"On the heels of building a pipeline of new projects, we now need local leadership and neighborhood knowledge to build projects specifically for the residents of Arizona" Altman said.
As the company builds its pipeline, plans call for adding a development manager, analyst and construction manager to the Phoenix team, Nye said.
Population growth fueling apartment construction
The Phoenix multifamily market has posted some eye-catching performance during the past several years, attracting the attention of multifamily developers and operators, said Peter O'Neil, research director for Northmarq.
"Maricopa County has led the country in population growth in each of the past several years, and that in-migration from other markets, combined with a steady stream of strong job growth across several industries is fueling demand for all forms of housing," O'Neil said. "From a development standpoint, the Phoenix area has a great story to tell. Developers know that this is a market that will attract new renters to the market, and with the types of high-wage jobs we're adding, developers know that wages in the market will support the rents required for new projects to pencil."
Phoenix — along with other rapidly growing metros across the Sun Belt such as Texas, Florida and the Carolinas — is ascending toward Gateway Market status, said Thomas Brophy, research director for Colliers International.
Cortland has been a long time, active investor in the Southwest, he said.
"Cortland’s move to establish formal development operations in the Valley is not only a testament to the growth Phoenix has already seen, but also a bet on the sustained success of Phoenix into the future,” Brophy said.
It also comes at a time when the Valley remains undersupplied in apartment units.
Fueled by above average population growth, job growth and more than $60 billion in advanced manufacturing/industrial projects representing more than 30,000 new high-paying jobs, Phoenix is one of the world's most coveted locations to invest, Brophy said.
