The Bentley's of Apartments

Is the car Kia and Bentley the same? Why not, they are both cars. They both get you from point A to point B. Yeah, I know there really is no comparison because of the quality and features. This illustration is the same when it comes to looking at apartments. Apartments are categorized into "classes." They are designated as "A, B and C." This article will inform you on Class A apartments (my next article will inform you on B and C apartments).
What are Class A apartments?


These types of apartment buildings are the "cream of the crop". They have all the bells and whistles. You want it, you got it...gyms, tennis courts, baby sitting, free work shops and other activities. Sometimes, the management companies try to be more creative with their amenities to lure and keep tenants. They want to make the community a "country club."
Some of the residents could afford a home in their area, but they may not choose to do so because of the convenience of the close proximity to their job and shopping and they like the extras it provides. These properties command higher rents compared to other apartments. Typically, these huge communities have a minimum of 100 units and were built over the last 10-20 years. Since it was developed more recently compared to other apartments, construction costs are higher, rents are higher, property tax is higher and they typically have a lower cap rate (the higher the price the lower the cap rate/return/interest).


What are REITs?
These properties are typically are owned and operated by Real Estate Investment Trusts (R.E.I.T.) REITs are traded publicly on the stock market. If you are an investor and wanted to buy Class A Apartments know that these prices start at around 10 million. That is why pension/syndicates/REITs purchase these properties because they can pool in money to make big purchases (If an investor wanted to pool in their money along with others, depending on the amount of people involved "Securities Laws" come into play).


Usually class A apartments don't provide a good ROI compared to other areas in investing. It is very hard to "create value" after you buy. It's like buying the very best property in a prestige side of town. It is going to be more expensive to buy and when you sell it, the ROI will be much lower compared to finding a property, fixing it up and selling it in the same neighborhood.
According to National Multi Housing Council, here is a list of the top 50 companies that own apartments along with the number of units they have ownership interest..
(50 Largest U.S. Apartment Owners as of January 1, 2007)
The order of entry will be the ranking first, second is the company and third is the amount of individual units).

1. AIMCO 211,800
2. MMA Financial LLC 117,062
3. Equity Residential 165,716
4. Boston Capital 156,758
5. Sun America Affordable Housing Partners 145,224
6. Archstone-Smith 84,176
7. Enterprise Community Investment Inc. 82,270
8. The Richman Affordable Housing Corporation 74,517
9. United Dominion Realty Trust, Inc. 70,339
10. GE Real Estate 67,561
11. PNC Multi Family Capital 64,843
12. Camden Property Trust 63,843
13. Edward Rose Building Enterprise 53,195
14. American Management Services (dba Pinnacle) 50,514
15. Fairfield Residential LLC 50,450
16. Avalon Bay Communities Inc. 48,294
17. Black Rock Realty 48,135
18. Lincoln Property Company 46,938
19. Wachovia 46,351
20. Sentinel Real Estate Corporation 45,293
21. WNC & Associates, Inc. 44,644
22. Alliance Holdings, LLC 41,517
23. Forest City Residential Group, Inc. 41,503
24. The Michaels Development Company 41,381
25. CNC Investments Ltd. LLP 40,330
26. Mid-American Apartment Communities, Inc. 40,293
27. Morgan Stanley 40,281
28. Alliant Capital Ltd. 40,000
29. Picerne Real Estate Group 38,979
30. Home Properties, Inc. 36,954
31. Colonial Properties Trust 33,724
32. The Irvine Company Apartment Communities 32,716
33. Holiday Retirement Corp./Colson and Colson 31,222
34. UBS Realty Investors LLC
35. The Related Companies 29,477
36. Essex Property Trust, Inc. 27,570
37. BH Management Company, Inc. 27,191
38. Lindsey Management Company, Inc. 25,508
39. Kushner Companies 25,000
40. Westdale Asset Management 24,841
41. BRE Properties 24,838
42. Madison Apartment Group 24,186
43. Southern Management Corporation 23,471
44. Trammell Crow Residential 22,749
45. AMLI Residential Properties 22,276
46. Northwestern Mutual 22,196
47. Post Properties Inc. 21,745
48. Security Properties Inc. 20,071
49. Berkshire Property 20, 062
50. Milestone Management 19,759


Top REITs that own apartments (based on the same report from National Multi Housing Council)
1. AIMCO 211,800
2. Equity Residential 165,716
3. Archstone-Smith 84,176
4. United Dominion Realty 70,339
5. Camden Property Trust 63,843
6. Avalon Bay Communities 48,294
7. Mid America Apartments 40,293
8. Home Properties, Inc. 36,954
9. Colonial Properties Trust 33,724
10. Essex Property Trust, Inc. 27,570

If you wanted to get an idea of Class A apartments, go to:
www.apartments.comwww.rent.com www.mynewplace.com
Play with the sites and search for the most expensive apartments in your area. Take a look at their amenities and if possible look at their web site. You will notice the level convenience and luxury.

If you want to find out more about sales of Class A apartments visit:
www.cityfeet.comwww.globest.com