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A new generation takes over Glick apartment empire

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For almost 20 years, the Gene B. Glick Co. has been a sleeping giant.

The state's largest owner and manager of apartments spent much of the 1960s through the 1980s building a massive portfolio of apartment communities, mostly for low-income residents.

The empire had grown to 100 properties and 18,000 total units across 10 states when Glick last developed a new property, in 1992 in Florida, before opting to focus on maintaining the existing stock.

Now, a new generation of company leadership is revving the Glick growth engine again.

The company is preparing to break ground on a 300-unit upscale apartment community in Noblesville—the firm's first new development in Indiana since 1986. It is negotiating to buy a 400-unit market-rate property on the north side of Indianapolis, and already bought two existing low-income properties this year for a family foundation.

"A very experienced and prolific developer is back in business again," said Steve LaMotte, a senior vice president and apartment broker in the local office of Los Angeles-based CB Richard Ellis. "They are not constrained by the capital markets like most, if not all, of their peers are. They're very liquid. They've built a war chest."

Glick Co. namesake Gene Glick, 87, is focused these days on retirement in Florida and philanthropic efforts, including the $15 million pledged for the Indianapolis Cultural Trail—A Legacy of Gene & Marilyn Glick.

Meanwhile, his grandson-in-law, David Barrett, has taken over as CEO of the Glick Co. Barrett, 38, has been with the company two years and took over about a year ago.

He spent much of his first year waiting for the right market to make a move. Acquisition opportunities weren't ripe at first, but that has changed, he said.

In recent months, the company snapped up the 92-unit Hampton Court on West 75th Street in Indianapolis, and the 146-unit Loper Commons in Shelbyville, both for a newly formed not-for-profit group with the goal of expanding quality affordable housing in Indiana. The Gene B. Glick Family Housing Foundation is designed to bring a new focus to the company's original mission, Barrett said.

The transactions are significant in that they are the company's first apartment acquisitions.

On the for-profit side, the company also is scouting for buying opportunities. It is in talks to purchase an upscale, 400-unit community on the north side, although Barrett would not name the property since talks are ongoing. There's no numerical goal for how many units to add, just a desire to grow the portfolio the company manages.

"We already have an established, stable business so we can be very selective in the opportunities we pursue," Barrett said. "And we think there are going to be some tremendous opportunities."

They also see opportunity in new development. First up is a 302-unit project called Promenade of Noblesville on 35 acres at the northeast corner of State Road 32 and Hazel Dell Road. And Glick has an option for more ground in Zionsville.

Geographically, Barrett likes West Lafayette and Bloomington, the state's top-performing apartment market for years. And he's looking around in Louisville, Chicago and Nashville, Tenn.

Glick Co. also has entered the self-storage business in a move designed to diversify its portfolio. The company has broken ground on a self-storage facility in Westfield and is looking for ground for another, in Carmel. It also is looking at acquisition opportunities.

Timing's right

The timing couldn't be better for Glick to start building apartments again, and to branch out to upscale development, said George Tikijian, a top local multifamily broker who runs Tikijian Associates.

"They're going to be cautious because they're smart folks, but I think they'll see good opportunities," he said. "They have the capital and talent to execute when they find the right deals."

Apartment fundamentals have held up well compared to other classes of real estate; average apartment occupancy for 2008 in Indianapolis was at 91 percent, and rent rates grew 2.2 percent. But broken-down capital markets have made multifamily deals tough to finance, said LaMotte, who represented the sellers in Glick Co.'s recent deals.

"Consequently, transaction volume has dropped 65 to 70 percent off 2007 levels," he said. "For a group like Glick, it's really the best scenario. It's a great time to be a buyer because they can."

Tikijian expects Glick will continue to be a developer that holds onto properties it develops for years, in contrast to many of its local competitors that tend to sell projects in relatively short order. The most active of Glick's competitors include J.C. Hart Co. Inc., Buckingham Cos., Flaherty & Collins Properties, Hearthview Residential Inc. and Pedcor Investments.

"It just took a youthful change in leadership to want to drive things forward," Tikijian said. "It's exciting."

Deep roots

The elder Glick entered the home business as a loan officer after he was discharged from the Army in 1945. By 1949, he and wife Marilyn had opened their own company and were building single-family homes.

They jumped into the multifamily market in 1962 and focused on apartments starting in 1974. All told, the company constructed more than 30,000 residential units in 10 states and continues to manage 10,000 apartment units in Indiana, along with properties in Florida, Georgia, South Carolina and New York.

Glick is on pace to pull in more than $150 million in revenue for 2008, the company said.

Many of the properties were built with the assistance of government grants for low-income housing, and carried branded names like Carriage House, Cambridge Square and Fairington. Glick Co.'s largest local properties include the 614-unit Carriage House East, 540-unit Carriage House West and the 460-unit Woods of Eagle Creek.

About two-thirds of the company's current portfolio resides in the affordable category, and carries the branding. The market-rate properties will each get separate names. Unlike other prominent apartment developers, Glick Co. has no plans to incorporate its own name into branding.

"Our philosophy is that every property is operated and maintained the same whether or not it is affordable," Barrett said.

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