Acquisition enhances proven portfolio strategy
and strengthens communities by expanding the supply of high-quality
affordable housing
NEW
YORK, May 9, 2023 /PRNewswire/ -- Nuveen,
the $1.1 trillion asset manager of
TIAA, is acquiring a portfolio of assets from Omni Holding Company,
a leading owner, operator and developer of affordable housing
nationwide.
The Omni transaction positions Nuveen as one of the nation's
largest institutional managers of much-needed affordable housing.
The deal increases the value of Nuveen's affordable housing assets
under management (AUM) to $6.4
billion and builds on the firm's long history of responsible
investing and stewardship in pursuit of attractive long-term
returns for investors. Financial terms of the transaction were not
disclosed.
The acquisition of Omni also significantly expands Nuveen's
scope in affordable housing as the firm continues to preserve
existing affordable housing units and protect at-risk units from
market-rate conversion so residents can remain in their homes.
Nearly all of Nuveen's impact housing portfolio serves
low-income residents earning 60% of area median income (AMI) or
less.
"The acquisition strongly advances our ability to promote
greater financial inclusivity, and health and wellness in
communities that have lacked meaningful and lasting investment,"
said Nadir Settles, Global Head of
Impact Investing at Nuveen Real Estate. "Our strong commitment to
affordable housing—and the communities where we are operating— is
also a strong commitment to our clients, who are long-term
supporters of this strategy."
Nuveen is managing this newly acquired portfolio of assets for
the TIAA General Account (GA) and for the benefit of retirement
plan participants. Affordable housing is an important part of the
GA's impact investing strategy and is well suited to the GA's
diversified portfolio, which is built to deliver predictable
returns over the long term.
Founded in 2004, Omni has acquired, rehabilitated or built 94
projects in the U.S. with more than 19,000 affordable housing
units. The Omni portfolio is largely concentrated in the
New York metro area, with more
than 10,000 units located in the Bronx, Brooklyn, Queens, Manhattan, Long
Island and Newark, N.J.
"Our goal is to meaningfully invest in the preservation and
expansion of high-quality affordable housing to support the
well-being of rent-burdened residents within local communities,"
said Pamela West, Senior Portfolio
Manager of Impact Investing at Nuveen Real Estate. "With the Omni
transaction, we can develop and manage properties across the U.S.
and achieve the desired outcomes for residents and investors."
Affordable Housing, an Urgent Need Nationwide
With extensive experience investing in U.S. affordable housing
dating back to 1992, Nuveen's transaction with Omni comes amid a
shortage of quality affordable housing and deepens the firm's
dedication to advancing change through impact investing.
The lack of affordable housing is a major economic and societal
challenge, particularly as rent inflation outpaces income growth
for mid- to low-income earners and the housing supply deficit
continues into its second decade. Nearly half of U.S. renters are
rent-burdened, meaning they are paying more than 30% of their
income toward rent. Within this rent-burdened demographic, one in
four renters are severely rent-burdened, meaning they pay more than
50% of their income toward rent.
"Demand for more affordable housing is intensifying nationwide,
and investors increasingly are attuned to emerging opportunities to
invest in housing that benefits society and also produces long-term
positive and predictable performance," said West.
Transaction Structure
As part of the transaction, Nuveen will acquire Omni's
best-in-class affordable housing capabilities in development,
construction, maintenance, safety-technology and corporate
functions to create an enhanced, vertically integrated affordable
housing asset management business for Nuveen.
Over the last decade, Nuveen has invested substantially in
affordable housing on behalf of the TIAA GA and third-party
clients. As a result of the transaction and pending approvals of
other related acquisitions, the TIAA GA is expected to own 161
affordable housing investments with approximately 32,000 units
across 24 states valued at $6.4
billion.
U.S. Impact Housing Fund
Nuveen Real Estate also plans to launch its U.S. Impact Housing
Fund, a core-plus, open-end vehicle, later this quarter. The
fund will focus on generating strong risk adjusted returns and
building resilience among low-income communities in the U.S.,
primarily by investing in rent-subsidized, income-restricted, and
Naturally Occurring Affordable Housing (NOAH) assets. The
combination of Omni's best-in-class capabilities and the fund
launch will bolster Nuveen's position to deliver a market leading
and scaled impact investment platform, providing deep value for
investors.
Jones Lang LaSalle Securities, LLC, an affiliate of Jones Lang
LaSalle Americas, Inc. advised Nuveen on the acquisition of Omni
Holding Company. Omni Holding was
advised by CBRE Affordable Housing in partnership with CBRE Capital
Advisors, Inc. Paul Hastings LLP and Nixon Peabody LLP acted as
transaction and regulatory counsel to Nuveen, respectively.
About Nuveen
Nuveen, the investment manager of
TIAA, offers a comprehensive range of outcome-focused investment
solutions designed to secure the long-term financial goals of
institutional and individual investors. Nuveen has $1.1 trillion in assets under management as of
31 Mar 2023 and operations in 27
countries. Its investment specialists offer deep expertise across a
comprehensive range of traditional and alternative investments
through a wide array of vehicles and customized strategies. For
more information, please visit www.nuveen.com.
Media Contacts
Wiley Norvell
Rubenstein
wnorvell@Rubenstein.com
646-422-9614
Sally Lyden
Nuveen
Sally.Lyden@nuveen.com
646-984-1913
Nuveen, LLC provides investment solutions through its investment
specialists.
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SOURCE Nuveen