Nuveen Acquires Former MLB Star's Affordable Housing Firm And Its 12,000-Unit Portfolio
The real estate arm of investment giant TIAA has made one of the biggest multifamily deals in the country this year, buying a portfolio largely based in New York City with 12,000 apartments.
Nuveen, which manages $1.1T in assets, has closed on its acquisition of the entire portfolio of assets of Omni New York LLC, the developer and owner co-founded by former baseball star Mo Vaughn and Eugene Schneur, according to a release.
Omni has overseen the rehabilitation and construction of more than 19,000 units of affordable housing since its founding in 2004. The entirety of the existing 12,000-unit portfolio, with more than 10,000 units in the Bronx, Brooklyn, Queens, Manhattan, Long Island and Newark, New Jersey, is affordable and will now be operated by Nuveen, which plans to maintain the units' affordability.
“The acquisition strongly advances our ability to promote greater financial inclusivity, and health and wellness in communities that have lacked meaningful and lasting investment,” Nadir Settles, Nuveen Real Estate’s global head of impact investing, said in a statement.
The deal brings Nuveen's affordable housing portfolio to $6.4B under management. Terms of the acquisition were not disclosed, but a spokesperson for Nuveen told Bisnow that before the deal, the firm had a 121-property, 21,000-unit affordable housing portfolio worth $3.2B, and another $500M invested in debt and equity strategies.
The acquisition will diversify the assets that contribute to the TIAA General Account, designed to deliver predictable returns for the benefit of retirement plan participants, the release said. Following this deal, TIAA GA will own 161 affordable housing investments spanning 32,000 units in 24 states.
Omni’s units will be incorporated into Nuveen Real Estate’s U.S. Impact Housing Fund, a vehicle that the asset manager plans to open in the coming months. A press release said the fund will focus on generating risk-adjusted returns and building resilience among low-income U.S. communities with the aim of creating a scaled impact investment platform.
Nuveen has invested in affordable housing in the U.S. since 1992, but the Omni acquisition takes place against a backdrop of a severe housing supply and affordability crisis across the country — and especially in New York City.
The average renter in the U.S. is now rent-burdened, paying 30% of their income or more for housing, according to research published earlier this year by Moody’s.
“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,” Pamela West, Nuveen Real Estate’s senior portfolio manager of impact investing, said in a statement.
Most of Nuveen’s impact housing portfolio serves low-income residents earning 60% of area median income, according to the release.
“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,” West said.
Roughly 600 Omni employees will join the staff at Nuveen, a spokesperson for Nuveen told Bisnow by email. Nuveen will also assume all debt related to the properties.
Omni was co-founded in 2004 by Schneur and Vaughn, who played in Major League Baseball for the New York Mets, Boston Red Sox and Anaheim Angels, winning the American League Most Valuable Player award in 1995. He hit 328 home runs before retiring in 2003, founding the affordable housing company the following year.
The Midtown Manhattan-based company has developed scores of mixed-income projects in the five boroughs, and also has properties in New Jersey, Rhode Island, Massachusetts, Maryland and Wyoming, according to its website.
Representatives for Omni didn't respond to Bisnow's request for comment. Nuveen's spokesperson declined to comment on if Vaughn or Schneur would be joining the firm.
