September 29, 2015
Anton Development, a 20-year-old firm with experience in affordable and market-rate multifamily housing, is boosting its platform around the Bay Area and looking for more development opportunities. Right now, the firm, which is moving from Sacramento to San Francisco, has 1,000 units in predevelopment and is actively looking around the Bay Area, as well as areas in Southern California to build projects. Among Anton’s endeavors is the 211-unit Anton Evolve, in Emeryville, which is pictured above. Andrew Baker, the company’s Senior Vice President of Development and Acquisitions, joined Anton Development at the beginning of the year to help the firm grow in the Bay Area. He was formerly an executive at REIT Essex Property Trust, and also had stints at BlackRock, Bank of America and Wedbush Securities. He recently shared Anton’s strategy with Connect Media.
Tell us about your new role and how it’s different from what you did at Essex.
“At Essex, I was part of a development team, and we were probably the premier active West Coast REIT. The role is very similar, other than it being a leadership role in a new platform. I was brought over to Anton to expand the market-rate multifamily platform in the Bay Area, which involves ground-up multifamily development. We’re looking for sites that are one to 10 acres, and 50 to 500 units. We’re looking for opportunities in supply-constrained markets. That’s leading us through the five-county Bay Area to find certain sites that meet our criteria. We’re very active on the Peninsula, in the South Bay and the East Bay. We’re also moving our headquarters from Sacramento to the Bay Area on the Peninsula on Oct. 1.”
Is it difficult to find the right sites in such a competitive environment?
“Yes, it is extremely competitive out there these days. Land prices have escalated dramatically over the past five or six years. The entitlement process is becoming more challenging, there are more owners and impact fees are up. Almost all deals require an affordability component now if you want to work your way through the entitlement process. And our competitors are all out there chasing the same deals. It’s extremely challenging to find work that meets the appropriate cap rate and return-on-cost threshold.”
Do you have any particular strategy to compete with other firms? Does Anton’s affordable-housing background help?
“We often will partner with firms that are doing market-rate deals, and we will be their affordable solution, where they need affordable housing as a component of that. It’s a strategy that we continue to expand. It really is appropriate at this point in the market with the need for more housing, and additionally, affordable housing.”
So, since so many municipalities are requiring affordable housing, are you filling a valuable niche in the sector?
“That’s one of the things that either brings us into the conversation or makes the opportunity more real– the fact that we have that affordable-housing background. Now, sometimes, in a certain situation, it’s appropriate to have market-rate housing, if it’s right by transit and high density. But, there are other situations where affordable housing needs to be a part of the conversation. And we’re very adept at solving that process. That’s a market advantage for us.”