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Eleventh Annual NMHC 50 Finds Continued Growth and Consolidation

In 1999 the apartment industry polished its reputation as one of the steadiest performers of all segments of the real estate industry. This is reflected in the NMHC 50, which shows continued growth among the nation's 50 largest apartment companies, as measured both by absolute holdings and by market share. The growth continued even as the number of big mergers and acquisitions moderated from the vigorous pace of the previous few years. Most of the notable gains during 1999 were by private entities and the publicly traded Lend Lease. Growth among publicly traded apartment REITs, which had been the story for several years, slowed during 1999. Another indication of the industry's stability is the relatively low number of newcomers to this year's ranks of top apartment firms.

The 50 largest apartment owners increased their holdings by 9%, off slightly from last year's record growth of 11% but still well above the average growth of recent years. The portfolio gains were greatest among the giant firms in the top 10 spots in the rankings. Despite an off year for REITs, they easily retained the top two positions in the NMHC 50, and the 16 public REITs in this year's rankings account for 40% of the total holdings of the NMHC 50.

The NMHC 50 of apartment management, which ranks the 50 largest apartment managers, posted a 4% gain in the total number of apartments managed over the year. As with the ownership listing, the number of new names and big changes in management portfolios were lower than usual during 1999. Specialists who manage apartments owned by others - known in the business as "third party" managers - maintained their position in the management NMHC 50 during the year.

The nation's 50 largest apartment owners and managers once again increased their share of the nation's apartment market in 1999. As of January 1, 2000, the top 50 owners had an ownership interest in 2.5 million apartments, approximately 15% of the total national stock. Yet even as consolidation continues, the apartment business remains highly fragmented by the standards of many American industries. Most of the nation's apartments are still owned and managed by individuals and smaller firms, indicating that the industry continues to provide business opportunities for a wide variety of players.

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