First American: Mortgage rates champion growth in potential existing home sales

First American | May 20, 2019

In April, potential existing-home sales increased 0.1% from the previous month, narrowing the market’s improvement gap, according to First American’s Potential Home Sales Model. “The housing market continued to underperform its potential in April 2019, but the performance gap shrank compared with March,” First American Chief Economist Mark Fleming said. “Actual existing-home sales remain 1.3% below the market’s potential, but the performance gap narrowed from 2% last month, according to our Potential Home Sales Model.”

Spotlight

Major metropolitan areas across the United States and internationally have experienced tremendous economic and population growth over the past five years, resulting in near-maximum occupancy of both residential multi-family (apartments and condominiums) and commercial property. Available inventory is commanding premium rates, with additional supply being built on a record scale to meet demand.

Spotlight

Major metropolitan areas across the United States and internationally have experienced tremendous economic and population growth over the past five years, resulting in near-maximum occupancy of both residential multi-family (apartments and condominiums) and commercial property. Available inventory is commanding premium rates, with additional supply being built on a record scale to meet demand.

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BUYING/SELLING

Pacaso Launches Innovative Luxury Second Home Co-ownership Platform in Jackson Hole

Pacaso | November 15, 2021

Pacaso, the leading real estate platform that helps people buy and co-own a luxury second home, today announced that it has expanded its service to Jackson Hole, Wyoming. The company listed its first property in Jackson alongside plans to support the Community Housing Fund and Teton Habitat for Humanity. "Jackson Hole's majestic beauty coupled with its wide array of year-round outdoor recreational activities has made it a highly desirable location for second home buyers, many of whom are looking to enjoy their newfound remote work flexibility from the mountains. As in many mountain towns, this demand has increased the strain on housing inventory needed by the workforce. Pacaso offers a better way; co-ownership empowers buyers to uplevel their focus toward luxury properties, and away from lower price points." - Pacaso Co-founder and CEO Austin Allison For 2022, Pacaso will be supporting the local Community Housing Fund with an upfront donation of $10K and an ongoing donation of $5K for each home Pacaso purchases. The company will also appeal directly to the sellers' agent to match its giving for each home and partner with Fund leaders to encourage others in the real estate community to give. Pacaso will also donate lightly used furniture and home goods from the acquisition of new homes to Teton Habitat for Humanity. "I am delighted Pacaso has chosen to proactively participate in the Community Housing Fund. Broad-based, sustained participation from the real estate community is critically needed to support our community members facing housing insecurity. I look forward to partnering with Pacaso to grow this fund's impact." - Devon Viehman, Associate Broker of the Viehman Group. Pacaso partners with all interested real estate agents and brokerages in markets where it operates. Real estate agents representing buyers who purchase a share of a Pacaso home receive a 3% referral commission in addition to 500 RSUs of Pacaso stock as a referral equity bonus. Agents in Jackson Hole who are interested in working with Pacaso can learn more on the company's website. Pacaso's first listing in the area is a contemporary five-bedroom home situated atop the ridge of Spring Creek with sweeping views of Sleeping Indian Mountain and the Grand Tetons. The home was designed by Ward Blake architects. About Pacaso Pacaso® (pronounced like "Picasso") modernizes the decades-old practice of co-ownership by creating a marketplace that makes buying, owning, and selling a luxury second home easy. From curating the best listings in top second home markets to offering integrated financing and sales from as little as ⅛ to as much as ½ ownership; upscale interior design; and professional property management, Pacaso provides owners with all the benefits of owning a second home with less hassle. After purchase, Pacaso manages the home on an ongoing basis and supports a frictionless resale process in partnership with a licensed real estate professional.

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REAL ESTATE INVESTMENT

Venterra Realty Acquires Houston Multi-Family Community

Venterra Realty | January 11, 2022

Venterra Realty acquired Stoneridge on the 8, formerly Advenir at Stone Park, in Houston, TX. The 480-unit, three-story multifamily community was built in two separate phases in 2004 and 2007. Located along Beltway 8 in Houston, Stoneridge offers excellent connectivity to its residents, within 1.5 miles of two other major highways, Interstate-10 and Highway 90. The Port of Houston, about 6 miles from the property, is one of the leading employment drivers in the Houston Metro area and serves as the epicenter of the petrochemical industry in the U.S. The property provides renters with an extensive amenity package, including two resort-inspired swimming pools, an around-the-clock fitness center, a resident game room, detached garages, additional covered parking and bark parks for small and large pets. The community offers modern finishes with black or stainless-steel appliances, oversized closets, garden tubs, double sink vanities, and private patios or balconies perfect for enjoying neighborhood views. Houston is one of the fast-growing metropolitan areas in the United States, with its population growing 20.3% from 2010 to 2020 ranking top three nationwide. So Stoneridge on the 8 is naturally a valuable investment to be added to the growing Venterra portfolio in this top-performing market." Venterra Realty Chairman, Andrew Stewart. Venterra will implement its resident-focused programs such as the Live it. Love it. Guarantee.TM, the 48-Hour Maintenance Guarantee, SMARTLEASING, as well as their overall commitment to providing a world-class living experience for which Venterra has become known. Houston is our headquarters and the city that housed the first properties Venterra managed over 20 years ago. We have seen first-hand the growth potential for this area of the country and are excited to expand our portfolio in a city we are confident will provide great return on investments, This property in particular offers significant opportunity and will benefit substantially from the completion of a unit upgrade program, the addition of the SMARTHOME technology package, and the deployment of Venterra's customer-focused management platform." John Foresi, CEO of Venterra Realty. About Venterra: Founded in 2001, Venterra Realty owns and manages approximately 70 communities and more than 20,000 apartment units across 13 major US cities that provide housing to over 40,000 people and 12,000 pets. The organization has completed $7.2 billion in real estate transactions and currently manages a portfolio of multi-family real estate assets valued at approximately $4.0 billion. Venterra is committed to improving the lives of its residents by delivering industry-leading customer experience.

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REAL ESTATE INVESTMENT

Smart Building Pioneer Brivo to Become Publicly Traded Company Through Merger With Crown PropTech Acquisitions

RentPath | November 10, 2021

Brivo, Inc., the global leader in cloud-based access control and smart building technologies, and Crown PropTech Acquisitions (NYSE:CPTK) (“Crown”), a publicly traded special purpose acquisition company, today announced that they have entered into a definitive merger agreement that will result in Brivo becoming a publicly listed company. The transaction values the company at a pro forma enterprise value of $808 million. Upon closing, the combined company will operate as Brivo, and its Class A common stock is expected to be listed under the ticker symbol “BRVS.” This strategic business combination will enable Brivo to leverage Crown’s experience and relationships as an owner and operator of commercial real estate to accelerate market expansion. Since its founding in 1999, Brivo has pioneered and defined the cloud-based access control category. Brivo’s leadership was instrumental in transforming the security industry, which at the time was dominated by on-premise client-server technology, and has achieved remarkable growth with the innovative cloud-based hardware and software solutions it began rolling out in 2002. Today, Brivo builds and sells Software-as-a-Service-based (SaaS) building access management services and innovative connected devices to enterprises and property owners through over 1,500 channel partners. These partners provide local sales, service and installation across all classes of commercial real estate including office, industrial, multifamily and retail properties. As it continues to scale, Brivo expects to benefit from the dramatic increase in smart space adoption driven by the PropTech boom, the growing customer preference for cloud-based services, the new normal in safety and health, and a shift in security integrator channel sentiment – which has swung from 20% to 75% in favor of the cloud over the last five years. Brivo has become the single largest access control system in the world, serving a large, diversified global customer base of more than 44,500 customer accounts comprising over 300 million square feet of commercial property, 330,000 doors and 23 million credentialed Brivo users across 42 countries, all 50 states and Puerto Rico. Corporations and owners and operators of commercial real estate that use Brivo’s technology and services include Greystar, Whole Foods, NTT, DocuSign and Realogy. Brivo’s foundational platform for smart spaces includes access management, sensor monitoring, visual awareness, visitor and delivery management, and AI-driven data analytics, providing customers with all the core functionality required to operate, glean valuable insights, and optimize the performance of their buildings. Brivo’s sustained double-digit annual growth has been driven by constant innovation coupled with a focused land and expand strategy that has successfully increased annual recurring revenue over time by scaling customer adoption of products and services. The company’s extensive channel partner ecosystem is a key differentiator that allows Brivo to achieve attractive unit economics that drive highly productive and profitable customer relationships, with a compelling lifetime value (LTV) to customer acquisition cost (CAC) ratio of 6.1x. The company has significant organic growth opportunities with strong visibility into future financial performance from its high-retention SaaS-based model. “As an owner and operator of a sizable portfolio of commercial properties, we recognize the significant value Brivo brings to the ecosystem, and we believe there is a compelling opportunity to leverage our experience and relationships to further establish the company as the pre-eminent provider of cloud-based access control and smart building technology. Brivo has demonstrated its value through its strong subscription revenues, retention rates, network of channel partners, and successful land and expand strategy, creating a highly loyal customer base. We look forward to supporting Steve and the team as they advance their strategic priorities.” - Richard Chera, Chairman and CEO of Crown PropTech Acquisitions Transaction Overview Golub Capital Credit Opportunities has agreed to lead a $75 million convertible note PIPE in the combined company that will close concurrently with the business combination subject to satisfaction of related conditions. Eagle Eye Networks is also a strategic investor in the PIPE. There is approximately $276 million currently held in Crown’s trust account, subject to any redemptions by Crown shareholders. Existing Brivo shareholders will roll over 100 percent of their equity, retaining 69 percent ownership in the pro forma company. Assuming no redemptions, Crown shareholders will own approximately 31 percent of the combined company. “We are excited to provide a highly structured and flexible financing solution to support Brivo, the market-leading provider of cloud-based access control solutions in the enterprise and commercial segments. We think Brivo’s strong management team, coupled with Crown’s deep experience in real estate and the leadership of a proven serial technology entrepreneur like Dean Drako make for a world-class combination.” - Marko Soldo, Head of Golub Capital Credit Opportunities. The business combination will provide Brivo with up to $304 million of capital to advance its mission of delivering the highest quality products and services to protect its customers and to fuel growth via the expansion of sales and marketing, customer acquisition, SaaS service expansion and product development, with the actual amount of capital provided depending on the level of redemptions by Crown shareholders. The company has substantial runway within its current user base and a focused commercial strategy to drive market penetration and upselling. Brivo expects to generate $417 million in revenue and an annualized $290 million in annual recurring revenue in 2025, representing 2021E to 2025E CAGRs of 55% and 70%, respectively. Brivo's proven management team – including Van Till, COO John Szczygiel, CFO Mike Voslow and CTO Jeff Nielsen – will continue to operate and manage the combined company following the transaction. Dean Drako, founding CEO of Barracuda Networks, will continue to serve as Brivo’s chairman of the board. The boards of directors of Brivo and Crown have unanimously approved the business combination. The transaction will require the approval of the stockholders of Crown, and is subject to other customary closing conditions, including the receipt of certain regulatory approvals. The transaction is expected to close in the first half of 2022. Imperial Capital is acting as financial advisor, and Latham & Watkins LLP is acting as legal advisor to Brivo. RBC Capital Markets, LLC is acting as financial advisor and capital markets advisor to Crown, and as exclusive placement agent on the private placement. Davis Polk & Wardwell LLP is acting as legal advisor to Crown. Shearman & Sterling LLP is acting as legal advisor to RBC Capital Markets, LLC. Simpson Thacher & Bartlett LLP is acting as legal advisor to Golub Capital Credit Opportunities. About Brivo Brivo is the global leader in mobile, cloud-based access control for commercial real estate, large distributed enterprises, and multifamily residential. Our comprehensive product ecosystem and open API provide businesses with powerful digital tools to increase security automation, elevate employee and tenant experience, and improve the safety of all people and assets in the built environment. Having created the category over twenty years ago, our building access platform is now the digital foundation for the largest collection of customer facilities in the world, trusted by more than 23 million users occupying over 300 million square feet of secured space in 42 countries. Our dedication to simply better security means providing the best technology and support to property owners, managers, and tenants as they look for more from buildings where they live, work, and play. Our comprehensive product suite includes access control, smart readers, touchless mobile credentials, visitor management, occupancy monitoring, health and safety features, and integrated video surveillance, smart locks, and intercoms. Valued for its simple installation, high-reliability backbone, and rich API partner network, Brivo also has the longest track record of cybersecurity audits and privacy protections in the industry. About Crown PropTech Acquisitions Crown PropTech Acquisitions (NYSE:CPTK) is a blank check company organized for the purpose of effecting a merger, capital stock exchange, asset acquisition or other similar business combination with one or more businesses or entities, with a focus on businesses that provide technological innovation to the broader real estate ecosystem. The management team is led by Richard Chera, the company’s Chief Executive Officer and director, who also serves as co-founder and Senior Managing Director of Crown Acquisitions Inc. and co-founder and Chief Executive Officer of ReWyre®; and Dr. Pius Sprenger, the company’s Chief Financial Officer and director, who was formerly an executive of Cantor Fitzgerald and Deutsche Bank. Rasheq Zarif serves as lead strategic advisor to the company.

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