“My motto was always to keep swinging.” - Hank Aaron

With SO much PE money anxious for institutional multifamily action, some of the market’s more dominant players are showing a willingness to trot out and see what they’re worth. The latest example, though, is a real whopper: Cortland, which is a top 10 multifamily landlord nationally, retained investment bank Evercore over the summer to help it explore strategic options, The Promote has learned. The Steven DeFrancis-led Atlanta-based giant owns about 75K units nationally, but may feel the environment is ripe to scale further w/ some PE fuel. And amid a flurry of dealmaking – take your pick, from Blackstone-AIR to KKR-Quarterra – Cortland’s size, streamlined ops and broad base of capital relationships make it a tasty target.

“Can you imagine the liens?”
“Can you imagine the Diet Coke budget?”
“If you are the head of alt investing at a big RIA, you might not pay for a meal for the next decade.”

On Ep. 20 (!) of The Promote Podcast, we catch a PIA flight to the heart of Midtown, where Jamie Dimon’s JPMorgan is making a move for the Pakistani govt.’s Roosevelt Hotel, as part of a mega-campus play for the country’s most important bank. We give additional color on the Cortland and Bell Partners I-banking processes, and look at how other major players like Greystar are looking to cast a wider investor net. Finally, we do a quick-and-dirty breakdown of the Starwood-Fundamental NNN deal.

Listen on Spotify here, YouTube here or Apple Podcasts here. A shout-out to our sponsor for this episode, Vesto - learn more about how it gives CRE players a single, clear point of access for all their bank accounts by going to vesto.com

Cortland company insiders confirmed the Evercore assignment but declined to comment further. According to sources familiar w/ the deliberations, DeFrancis is looking at this as more of a growth capital play, i.e. get the money while the gettin’s good, rather than a sell & ride the golden chariot into the sunset situation 🐴 🌆 . Having access to a larger war chest would allow Cortland to play offense at a time when great deals are there for the taking, w/ many players finding themselves overextended and out of time on prime assets. Think of Cortland’s recent rescue pref 🛟 deal on Flow’s Buckhead tower as but one example; many opportunities of its ilk are popping up even on portfolio deals. In Sept., Cortland formed a pref JV w/ Declaration Partners (money manager anchored by David Rubenstein’s FO) to pounce on such dislocation.

As Cortland is privately held, it’s tricky to get an overall sense of performance. One can glean snippets of how certain funds have done by poking through disclosures from pension funds that are LPs in Cortland’s funds. NYCERS, for e.g., which contributed $129M to the open-ended “Cortland Growth and Income, L.P.” in April ‘20, marked its equity at 1.17X EM as of Feb. ‘25, w/ an IRR of 4.6%. On the closed-end “Cortland Enhanced Value Fund VI, L.P,” which NYCERS committed $24M to in Dec. ‘23, it marked its equity at .95x EM, or -12.2% IRR. LACERS, which contributed $105M to “Cortland Partners Growth and Income Fund” (‘22 vintage), disclosed a .72X multiple on that money in ‘24, a -16.4% gross IRR / - 17.20% net IRR.

DeFrancis founded Cortland in ‘05 as an Atlanta-focused multifamily developer. When the GFC hit, he switched things up to focus on acquiring & renovating existing properties. Over the years, the firm earned a rep for being maniacally focused on vertical integration – Willy Walker recalls walking into a Cortland office and seeing a projection of ships traversing the Pacific Ocean w/ the firm’s building materials 🚢 🧱 Even as it’s gotten huge, the firm has managed to keep a low-ish national profile, though it was recently in the headlines over the RealPage algorithmic-pricing mess and its subsequent settlement w/ the DoJ.

The firm’s other key execs include president of investment management (i.e. the LP Whisperer) Jason Kern and CIO Mike Altman. Cortland placed 9th on NMHC’s Top Owners list in ‘25. At the time, it had just over 73K units, but those numbers are constantly shifting; Cortland is now in the thick of a major disposition of a portfolio it owns w/ JVP Management, insiders confirmed to The Promote.

It’s far from the only major apartment landlord doing some soul-searching. The Promote reported earlier this month that NC-based Bell Partners, which owns 20K+ units and has a large external property-management business, is also going through a banking process. Meanwhile, Greystar is looking to tap the pockets of dentists and Indian doctors everywhere, launching a private wealth team to court FOs and RIAs.

One thing we’ve been thinking about wrt big-ticket CRE M&A, and crystalized beautifully in this piece on the Blackstone-QTS merger, is that integration doesn’t always go how the founder hopes it might. Having a PE paymaster or partner can mess w/ things a founder may consider his birthright, such as goal-setting for the business and defining the culture. It’s something DeFrancis, who built Cortland from nothing into a national behemoth, will surely be pondering.

Our muscly friends at the B1M produced this short doc on the various problems plaguing Billionaires’ Row supertall 432 Park Ave, from resident quality-of-life complaints to far more serious allegations of “structural corruption” lobbied at developers Harry Macklowe & CIM Group. The B1M reached out to us to participate, and Hiten weighed in on how the diffusion of responsibility inherent in high-stakes ground up development – we likened it (15:13) to the way the Corleone family was structured – makes it legally very tricky to assign blame, and how for-sale product can sometimes incentivize developers to cut corners. If you enjoy it, you’ll surely love Hiten’s co-production w/ the B1M on 220 CPS.