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Leaving Las Vegas: Camden Property Trust Sells Entire Nevada Portfolio to Oaktree/Bascom JV

Bascom/Oaktree Joint Venture Pays $630 Million for 4,918 Apartment Units
May 2, 2016
Camden Property Trust began its first quarter earnings conference call last Friday to Faith Hill singing Lets Go to Las Vegas and ended it with Sheryl Crow singing Leaving Las Vegas. The musical bookends signalled to investors that the REIT had done what few gamblers have accomplished, leaving Las Vegas with a lot of money.

“The 18 years covered by those two song titles represent our tenure in Las Vegas which came to a close this week. It’s been a great ride,” said Richard J. Campo, Camden chairman and CEO.

The day before the earnings call, Camden completed sale of its Las Vegas portfolio as part of the REIT’s capital-recycling initiatives. The portfolio included 15 communities with 4,918 apartment homes, a retail center, and 19.6 acres of undeveloped land.

The buyer is a partnership between The Bascom Group and Oaktree Capital Management, a joint venture that has recently been teaming up on apartment purchases. The joint venture paid $630 million for the portfolio or about $125,000/unit.

The communities in Camden’s Las Vegas portfolio were built in the 1990s. The properties reported a combined average occupancy of 95% in the first quarter with average rents of $874/unit.

Camden decided to cash out its Las Vegas assets after remaking the balance of its portfolio, Campo explained. The Las Vegas apartments are roughly twice as old and had monthly revenue of roughly $500 per home less than the balance of its portfolio.

“We have consistently sold older, non-core properties and replaced them with more current and competitive properties,” Campo said. “This effort has increased our revenue per apartment from a $1,042 per month to $1,566 per month.”

“We're not calling a top to the multifamily market with our sales,” Campo was quick to add. “We're simply taking advantage of the market opportunity to improve the quality of our properties, reinvest in development on a significant cash-flow positive basis, pay down debt, and return capital to shareholders.”

Camden currently has no other single market portfolio of apartments averaging the rents/home that Las Vegas was getting. Its next lowest market would be Raleigh/Durham where it owns eight communities with 3,054 units averaging $1,002/unit rents.

For more information on the sale, see CoStar Comp #3578091.

Camden’s Las Vegas Portfolio Sold

Complex -- No. of Units -- Rent/home

Camden Palisades -- 624 -- $773
Camden Del Mar -- 560 -- $1,032
Camden Bel Air -- 528 -- $790
Camden Tiara -- 400 -- $965
Camden Commons -- 376 -- $851
Camden Vintage -- 368 -- $776
Camden Breeze -- 320 -- $820
Camden Fairways -- 320 -- $957
Camden Pines -- 315 -- $913
Camden Pointe -- 252 -- $801
Camden Summit -- 234 -- $1,192
Camden Canyon -- 200 -- $965
Camden Hills -- 184 -- $555
Camden Cove -- 124 -- $781
Camden Legends -- 113 -- $876

SOURCE: Camden Property Trust
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