Compatriot Capital, a real estate operating and investment subsidiary of Sammons Enterprises, is making a significant capital investment in JLB Partners, a Dallas-based multifamily developer and builder. The investment will make Compatriot a leading minority shareholder.
There will be no change in JLB Partners management. Financial terms were not disclosed.“We see JLB as a leader and an innovator in the luxury multifamily housing market and among the very best in their markets in terms of quality developments,” said Paul E. Rowsey, president and CEO of Compatriot, in a statement. We “saw a unique opportunity to make an investment in a company that has a history of success, a superior industry reputation, and is well-aligned with our overall investment strategy.”
Rowsey said the strength of JLB’s management team, its relationships with the institutional investment community, and strategic market footprint were key factors in the decision to invest.
It’s Compatriot’s second investment since announcing plans last year to build a $1 billion real estate business over the next decade by acquiring stakes in real estate operating companies. Last December it took a 50 percent stake in Village Green, based in Farmington Hills, Mich.
In 2008, Compatriot and E2M Partners, a Dallas-based private equity firm, jointly acquired 50 percent of Dallas-based KDC Holdings. Compatriot also holds an ownership interest in E2M and is the lead investor in E2M-managed funds.
JLB Partners was launched in Dallas in 2007 by principals from Fairfield Residential, including its founder, Jim Bosler. It has about $1 billion in projects under development (approximately 5,100 units) under construction, plus another $1.1 billion in its pipeline (n additional 6,000 units).
The investment from Compatriot will allow JLB to expand its business model, said Bay W. Miltenberger, CEO of JLB Partners. The company will now look to hold certain properties long-term, he said, expanding operations and strengthening its capital base.
As part of the deal, Rowsey, along with Heather Kreager, chairman of Compatriot, and Mark Van Kirk, senior vice president of Compatriot, will join JLB’s board of directors.
Here’s more information on the players involved, taken from a press release:
• JLB Partners LLC is a national developer, builder and manager of Class A multi-family assets in select markets of the United States. The principals of JLB have worked together for more than 15 years. With projects in Dallas, Austin, Houston, Charlotte, Atlanta, Washington, D.C., and Phoenix, JLB has experience in a broad array of real estate developments, including low-density garden and medium- to high-density mid-rise and high-rise product intended for conventional rental, student housing, and mixed use developments. Based in Dallas, JLB has offices in Atlanta, Phoenix, Washington, D.C, and Miami.
• Dallas-based Compatriot Capital directs the real estate investment strategy for its parent company, Sammons Enterprises Inc. with a focus on entity-level investments in real estate operating companies.
• Founded in 1938, Sammons Enterprises Inc. is a multifaceted, global holding corporation with a diversified portfolio of investments, including wholly-owned businesses and investor partnerships in industries such as insurance, financial services, industrial equipment, energy, and real estate, among others. With assets approaching $55 billion, Dallas-based Sammons ranks among the largest privately owned companies in the world.