Japanese forestry giant grabs handle at Charlotte’s Crescent Communities
Novel Stonewall Station, a Crescent Communities project in downtown Charlotte, will have a Whole Foods Market and 459 apartments.
Crescent Communities’ sale to a 300-year-old Japanese firm could open up new avenues for growth, says Todd Mansfield, chief executive officer of the Charlotte-based real-estate developer. Sumitomo Forestry America, a Bellevue, Wash.-based subsidiary of Japan-based Sumitomo Forestry, said in April it was buying Crescent for $370 million and paying off $380 million of the company’s debt.
“Sumitomo Forestry certainly has an interest in growing the company,” Mansfield says. With the Japanese company’s deep pockets and booming economies in the nine states where Crescent is active, growth seems likely.
Crescent’s management team will remain in place, and the company also will keep its name and Charlotte headquarters. Crescent’s current owners will hold on to Palmetto Bluff, a 20,000-acre resort community in Bluffton, S.C.
Crescent Communities has long been one of the most active developers in the Charlotte area. Current projects include Novel Stonewall Station, a downtown development that will have 459 apartments and 64,000 square feet of retail space; the 26-story Ally Charlotte Center office tower, which is slated for completion in 2021; and the planned 1,400-acre River District mixed-use development adjacent to the Catawba River. In all, Crescent has more than $1 billion in assets under management and a development portfolio worth $2 billion.
The retirement of debt resulting from the sale will allow Crescent to invest more in new projects, Mansfield says. He adds that Crescent would love to ramp up more activity in the Triangle area, where it has developed several residential properties, as well as in Denver, Colo.
The deal with Sumitomo grew from a joint venture developing apartments at the Atherton Mill retail center in Charlotte. “Sumitomo is over 320 years old,” he says. “They think very long term, and I think that’s a good thing when you’re building communities.”
Crescent Communities was started in the 1960s as a land-management subsidiary of Duke Energy. The company, then jointly owned with a Morgan Stanley real-estate fund, filed for bankruptcy amid the recession in 2009, emerged a year later as a leaner organization and has since developed a variety of housing and office projects. Its current pipeline of projects includes 5,500 multifamily units, 2,200 single-family homes and 2.5 million square feet of office and industrial space.
“Crescent Communities has successfully established itself as an integrated platform of diverse real-estate assets with a significant development pipeline that provides a long runway for future growth,” said Atsushi Iwasaki, president of Sumitomo Forestry America, in a release.
Sumitomo Forestry’s roots are in forest management. The company owns more than 118,000 acres of forests in Japan and is the country’s third-largest private landowner. It began building homes in the Seattle area in the early 2000s and has since grown rapidly. Sumitomo owns five homebuilding companies across the United States, including
Matyland-based Dan Ryan Builders.
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