Aimco Pushes Back Upton Place Lease-Up Again
Upton Place reached 84% leased or pre-leased, but Aimco now expects lease-up completion in the fourth quarter.
Apartment Investment and Management Company (AIV), the multifamily real estate owner liquidating its portfolio, pushed back its Upton Place lease-up target for a second consecutive quarter. The company now expects completion in the fourth quarter, extending the timetable for one of the two recently completed Washington-area communities it planned to sell during its wind-down.
The target had moved from the second quarter in Aimco's year-end update to the third quarter in its March update. Leasing nevertheless advanced during the latest quarter: Upton Place had 578 of its 689 apartments leased or pre-leased at June 30, against 523 at March 31. Aimco gave no reason for the latest postponement in its project update.
The company still plans to broadly market Upton Place for sale in the third quarter, ahead of its revised lease-up completion target. Its retail space was 97% leased at June 30. At Strathmore Square's first phase in Bethesda, 197 of 220 apartments were leased or pre-leased, and the property was already being broadly marketed. Aimco expects that community's lease-up to finish in the third quarter.
Elsewhere, the liquidation moved from contracted sales to completed exits. Aimco sold its remaining New York City property in June for $22.9 million. That followed April sales of two other New York properties and one in Atlanta for a combined $56.5 million. Four San Diego properties held through unconsolidated partnerships also were sold in April, delivering Aimco net proceeds of $41.9 million.
Those disposals followed the first quarter's sale of the Chicago portfolio and properties in Nashville, Plantation and Aurora. By June 30, Aimco's remaining apartment assets included Bank Lofts in Denver, The Bluffs at Pacifica and Oak Shore in California, alongside the Washington-area lease-ups and its Miami construction project. Land parcels, seller financing and passive investments also remained to be liquidated.
Aimco paid its second special liquidating distribution of $1.30 a share on June 3. For the period from February 1 through June 30, distributions to shareholders and operating-partnership unitholders totaled $408.8 million. The $406.6 million reduction in net assets in liquidation over that period was primarily due to those payments, partly offset by a $1.5 million net increase from remeasurement of real estate and estimated costs in excess of receipts.
Net assets in liquidation stood at $514.6 million at June 30, against $705.9 million at March 31. That measure replaced the conventional earnings framework after Aimco adopted liquidation accounting on February 1. Current operating results were not comparable with the prior year, and Aimco stopped reporting EBITDAre, adjusted EBITDAre and other non-GAAP measures it no longer considered key indicators.
The remaining asset values were estimates rather than assured sale proceeds. Aimco valued properties using contractual prices, offers or management estimates informed by marketing activity and broker opinions. Estimated liquidation values might not be achieved. Its balance sheet included $145.2 million of liabilities for estimated costs exceeding estimated receipts during the liquidation process.
Available liquidity fell to $78.7 million at June 30 from $224.3 million at March 31. Cash, operating receipts and property-sale proceeds would provide sufficient liquidity through liquidation. Aimco also reported no scheduled debt maturities before December 2027 after available extensions, giving it time to continue selling assets while meeting its remaining obligations.
Construction remained a separate obligation: Aimco had approximately $57.4 million left to commit to its Miami development, with sufficient construction-loan capacity. The 34th Street tower remained on schedule and on budget. Although it had ceased planning future projects, Aimco still schedules initial occupancy there for 2027 and stabilized occupancy for 2028.
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