Clarion closes $3.2bn deal to buy Gables Residential

Clarion Partners has bought Gables Residential for around $3.2bn (€2.86bn), according to sources familiar with the deal.

Clarion declined to comment on the financial terms of the transaction.

Clarion and its group of investors have formed a perpetual life vehicle, Clarion Gables Multifamily Trust, as a result of the transaction.

Ed Carey, managing director at Clarion, said a mixed group of investors, including pension funds and sovereign wealth funds in the US and abroad, were behind the deal.

The portfolio, he said, was “very strong”.

It includes a portfolio of 52 properties totalling around 14,000 units in nine major US markets, including Boston, Denver, Washington DC, Houston and Dallas.

Clarion will grow the portfolio, he said.

“The primary growth of this investment entity will be with the development of new properties,” he said. 

“Development in the apartment market continues to provide value in this development cycle.”

A pipeline of 20 properties in various stages of development totalling another 5,700 units will also be developed, Carey said.

The transaction with Gables is Clarion’s second with the apartment company.

In 2005, Clarion purchased Gables, taking it private under the name Lion Gables Apartment Fund.

The entity had a 10-year life, due to end in September this year.