As Avalon Real Estate Partners sold dozens of sites across Georgia for multifamily developments in the past couple of years, the boutique brokerage became a hot property as larger firms sought to expand into the land business.
"We have been considering pursuits from various national real estate companies for some time now," Avalon founder President Brent Story said in an email.
This week, Atlanta-based Avalon accepted one of those offers and sold itself to Walker & Dunlop, a firm that's been growing aggressively. Terms of the transaction were not disclosed.
Walker & Dunlop "turned out to be the perfect fit for our team," Story said. "We have large exposure in multifamily and build-to-rent land which was also an excellent fit for WD with their existing platforms. Combined, we can get mutual lift in land, investment sales and financing downstream."
As part of the deal, Story and fellow Avalon partners Alexander Holt and Brooks Battle joined Walker & Dunlop as managing directors. Thornton Mallard and Daniel Candler, both of whom worked at Avalon for several years, joined Walker & Dunlop as directors.
Walker & Dunlop is creating its land sales specialty group as multifamily and single-family rental developers seek sites across the Southeast, as well as other parts of the country, to meet demand for rental properties. On Wednesday, the National Apartment Association and National Multifamily Housing Council said the country needs developers to build 4.3 million new rental units by 2035 "to address demand, deficit and affordability" in the sector.
Adding new specialty types such as land brokerage is part of Walker & Dunlop's Drive to '25 business plan that includes the goal of hitting various financial targets by 2025. One goal is to grow its property sales volume to $25 billion.
As part of its Drive to '25, Walker & Dunlop has opened new offices across the country and added key producers.
Kris Mikkelsen, executive vice president of Walker & Dunlop investment sales, said his group has known Story and his partners for a long time. Adding the Avalon team's expertise in the land advisory business to Walker & Dunlop's debt, equity and investment sales capabilities offers the chance for Walker & Dunlop to quickly grow its business, Mikkelsen said.
"With Avalon's robust pipeline of development land transactions, Walker & Dunlop has significant opportunity to expand the advisory services we provide our developer clients across all facets of the housing and broader commercial real estate market," he said in a statement.
Story founded Avalon in 2010 to provide land brokerage and investment capital sourcing consultation services across greater Atlanta. The firm has completed more than $700 million of transactions.