Behringer Harvard Summarizes 2011 Activities and Milestones
DALLAS, Jan. 9, 2012 /PRNewswire/ -- Behringer Harvard's key milestones in 2011 were summarized today by Mr. Robert S. Aisner, President and CEO of Behringer Harvard.
"We were pleased and gratified to celebrate the 10th anniversary of Behringer Harvard in 2011," said Mr. Aisner. "We are proud of our evolution thus far, which started with two predecessor organizations that began offering alternative investment opportunities in 1989. Although all our business units have faced economic headwinds, I believe we made significant progress during the last year in setting the stage for another decade of growth and expanded opportunity for Behringer Harvard and our various constituencies."
Behringer Harvard's multifamily platform received a boost in December 2011 via a new co-investment partnership with one of the world's largest pension funds, advised by Heitman LLC, a multinational real estate investment management firm with more than $23 billion in assets under management. While Behringer Harvard retained majority ownership, the Heitman-managed partnership acquired minority interests in 15 multifamily communities located in eight states comprising 4,100 apartment units. This additional infusion of institutional co-investment capital provided further market validation of the institutional quality of the asset portfolio owned by Behringer Harvard Multifamily REIT I, Inc., as well as its perceived value. The Behringer Harvard Multifamily REIT I, Inc. portfolio includes ownership interests in 42 multifamily communities in 13 states comprising 11,112 apartment homes, as of December 31, 2011.
Behringer Harvard Multifamily REIT I, Inc. raised gross proceeds of approximately $1.65 billion before the primary portion of its initial public offering was terminated in September 2011. Mr. Mark T. Alfieri, COO of Behringer Harvard's multifamily platform, led the team that successfully built an extensive multifamily asset portfolio during one of the most challenging economic environments in decades. Beginning in 2006, his team capitalized on market disruption by acquiring high-quality multifamily assets at attractively discounted prices. As a result of these efforts, Mr. Alfieri was recognized by Multifamily Executive magazine as Multifamily Executive of the Year for 2011. The same publication gave a Merit Award in the High-Rise Property of the Year category to The Cameron, a Behringer Harvard multifamily community in Silver Spring, Maryland.
In terms of the professionals it employs, the multifamily investment platform was a primary contributor to the growth of Behringer Harvard in 2011. Management of the multifamily portfolio has been transitioning in-house to Behringer Harvard Residential, the business unit responsible for management of the company's apartment communities. In just one year, Behringer Harvard Residential filled 165 new positions, driving a 34 percent increase in the number of Behringer Harvard employees. As a result of this growth, Behringer Harvard closed the year with 630 employees.
In summer 2011, the formation of a new related company, BH Capital, LLC, further contributed to Behringer Harvard's growth. BH Capital focuses on the acquisition of small-balance debt instruments sold on the secondary market via individual transactions or portfolio sales. BH Capital's investment strategy is to take advantage of opportunities presented by recent economic disruptions to acquire a blend of performing and non-performing loans secured by commercial real estate and other types of commercial and industrial assets.
The Behringer Harvard investment programs in their acquisition phases continued to expand the commercial real estate assets owned and managed by the company. Through September 2011, Behringer Harvard completed five acquisitions that added to the company's portfolio more than 537 self-storage units, 1,128 beds of student housing and 711 apartment units. Across all of its investment platforms as of September 30, 2011, Behringer Harvard had interests in or managed approximately 29 million square feet of office/industrial/retail space, 13,048 apartment units, 1,608 hotel rooms and 582 acres of developable land.
Some Behringer Harvard investment programs in later phases of their life cycles were particularly impacted during 2011 by a long and severe economic recession that reduced employment and occupancy rates and exerted downward pressure on rental rates and property values in some sectors and markets. The eurozone crisis has had a further chilling effect on the capital markets, reducing the amount of leverage available for opportunistic real estate investments.
In spite of continuing economic challenges, operating results improved on several fronts for Behringer Harvard's largest REIT to date, Behringer Harvard REIT I, Inc., which owns and manages a portfolio of 57 assets representing more than 22 million square feet of office space. Leasing activity through the third quarter was 3 million square feet, resulting in positive net absorption of 335,000 square feet and an increase in occupancy to 85 percent. The REIT also reduced its borrowing costs and addressed its 2011 debt maturities by completing $685 million of new financing including the closing of a $340 million credit facility.
The business unit responsible for property management of Behringer Harvard's office assets was recognized for excellence several times during 2011. The BOMA 360 Performance Program, sponsored by the Building Owners and Managers Association (BOMA) International, evaluates properties in six major areas to benchmark the performance of a specific property against industry standards. During 2011, the BOMA 360 designation was awarded to seven properties managed by Behringer Harvard: 200 South Wacker Drive and 222 South Riverside Plaza in Chicago; Fifth Third Center in Cleveland, Ohio; 250 W. Pratt in Baltimore; 1325 G Street in Washington, D.C.; One City Centre in Houston and Burnett Plaza in Fort Worth. Behringer Harvard also was included on the "Best of the Best" list published by Midwest Real Estate News in the property management and property owner categories.
Behringer Harvard was recognized in 2011 by the Texas State Board of Education for its exemplary record of encouraging and supporting employee participation in a student mentoring program at Jerry R. Junkins Elementary School in the Dallas Independent School District (DISD). Behringer Harvard was among three companies honored with the highest-level Gold Award in the Employers for Education Excellence (EEE) award program. The same student mentoring program was recognized earlier in the year by the DISD. At the 42nd Annual Partner/Volunteer Recognition Awards ceremony, the DISD presented Behringer Harvard with its "Outstanding Business Partner" award.
For the third consecutive year, Behringer Harvard was recognized in 2011 as a "Best Place to Work" by The Dallas Morning News. As Behringer Harvard concludes its first decade, the company looks forward to carrying similar achievements into another decade of continued growth.
About Behringer Harvard
Behringer Harvard creates and manages global institutional-quality alternative investment programs for individual and institutional investors. Programs sponsored and managed by the Behringer Harvard group of companies have attracted equity of more than $5 billion and made investments into more than $11 billion in assets. For more information, contact our U.S. headquarters toll-free at 866.655.3600 or our European headquarters at 011 49 40 34 9999 90, or visit us online at behringerharvard.com.
This release contains forward-looking statements relating to the business and financial outlook of Behringer Harvard Multifamily REIT I, Inc. and/or Behringer Harvard Opportunity REIT II, Inc. and/or Behringer Harvard REIT I, Inc. that are based on our current expectations, estimates, forecasts and projections and are not guarantees of future performance. Actual results may differ materially from those expressed in these forward-looking statements, and you should not place undue reliance on any such statements. A number of important factors could cause actual results to differ materially from the forward-looking statements contained in this release. Such factors include those described in the Risk Factors sections of the offering documents for the offering of shares of Behringer Harvard Opportunity REIT II, Inc. and/or the Annual Reports on Form 10-K for the year ending December 31, 2010 for Behringer Harvard Multifamily REIT I, Inc. and Behringer Harvard REIT I, Inc., each as supplemented in Quarterly Reports on Form 10-Q. Forward-looking statements in this document speak only as of the date on which such statements were made, and we undertake no obligation to update any such statements that may become untrue because of subsequent events. We claim the safe harbor protection for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
SOURCE Behringer Harvard