Bozzuto sees strong rent collection at its luxury apartments, eyes future growth

Posted by: mihaighimciuc 29 October 2020 No Comments

Nearly 100% of residents in the luxury apartment units owned and managed by the Bozzuto Group have paid rent during the Covid- 19 pandemic this year.

Toby Bozzuto, CEO of the Greenbelt-based company, said Friday the economic fallout and uncertainty sparked by the novel coronavirus has created a mix of optimism and caution in the Maryland multi-family market and beyond.

His comments were made during a wide-

ranging interview about the state of the luxury market, the growth of the company and prospects for the future.

Bozzuto posted revenue of $2.2 billion last year. It is one of Greater Washington’s larger luxury apartment developers with projects that include Cathedral Commons in D.C.’s Cathedral Heights, i5 at Union Market and Incanto at The Wharf, as well as many in the Maryland and Virginia suburbs. The company’s portfolio holds about 80,000 units that it owns or manages and Bozzuto is one of the largest multi-family companies in the mid-Atlantic, Chicago and Miami.

“The aim of any business during this time is not only to survive but we want to thrive,” Bozzuto said. “We want to use this time to be the very best company we

can be and work harder than we’ve ever worked. Our head is down. We hope that will create opportunities for us.

“I think that if we wake up everyday and read the newspaper, it is scary because of the world we are in. We’re building a place that we hope lasts a lifetime in the sense that I think that the luxury market is obviously a good market.”

Bozzuto this week announced a deal to develop 65 condominiums under the Ritz- C arlton Residence brand at the company’s 15-acre Chevy Chase Lake project in

Montgomery County. The $200 million mixed-use project just off Interstate 495 is a partnership between Bozzuto and the Chevy Chase Land Co.

The partnership with Ritz-Carlton, a subsidiary of Bethesda-based Marriott International, is a first for the Bozzuto Group, which has expanded its portfolio and reach under Toby Bozzuto’s management after he took over the helm from his father and company co-founder, Tom, in 2015.

Toby Bozzuto offered updates on the company’s growth strategy and the luxury multi-family market in general.

On how Bozzuto rent collections have fared since March: “We have been very fortunate in the Class A space with rent collections and have been able to collect nearly 98% of residential rent since March. We aim to work humanistically with people individually that are struggling and we are balancing that. We have fiduciary obligations, but also obligations to our residents. We’re very fortunate that we’ve done well.”

On moving the market forward amid Covid-19: “There is some pressure on occupancy in multi-family in its entirety. People have lost jobs and they may move out, so we’re watching those trends. We are cautiously optimistic that occupancy is holding, but logic will dictate that it will improve. We need to get through this cycle before rent growth can grow again. What we’ve decided is we can’t control the world, but we can control ourselves and the impact we hope to make on the world.”

On growth plans for the Bozzuto Group: “The world will return to more of a normal in the rental space over time and the projects will be well-positioned. We think that the larger we get, the larger our platform is to do something good.”