Forest City Expands Military Housing Program
Forest City Enterprises, Inc. (NYSE:FCEA)(NYSE:FCEB) today announced that its Forest City Military Communities, LLC subsidiary is expanding its military housing program to 11,956 units under management as a result of additional 50-year public/private venture agreements with the U.S. military.
In the northwest, Forest City has entered into an agreement to acquire American Eagle Communities’ interest in 2,985 Navy housing units and ancillary facilities. The Navy’s Northwest Region encompasses multiple housing neighborhoods associated with three Naval Installations in the Puget Sound area of the state of Washington. Subject to Navy approval and customary closing conditions, Forest City will be responsible for demolition, renovation and new construction of homes, representing approximately $169 million in development costs, as well as property management.
In addition, Forest City, together with a partner, has closed on a transaction with the United States Air Force to design, develop and construct military family housing units at the Air Force Academy in Colorado Springs, Colorado. The Air Force Academy project represents a development cost of approximately $80 million, and includes demolition of 814 family housing units, renovation of 299 units, rehabilitation of two historically significant homes and construction of 34 new family homes — for an end-state count of 427 family homes under management at the Academy.
Ronald A. Ratner, president and chief executive officer of Forest City Residential Group, Inc., said, “In just three years, the military housing business has grown to more than 11,900 permanent units, becoming a very significant part of our residential portfolio. Our ability to manage large, complex projects and create a sense of place in multifamily developments is being put to good use in our work with the Navy, Marines and Air Force. We are honored to have the opportunity to create and manage modern housing and communities that enhance the quality of life for our nation’s service personnel and their families.”
In Hawaii, Forest City has been selected to enter into exclusive negotiations with the Department of the Navy for a fourth increment (Marine Corps Phase II) on Oahu. Of 1,142 housing units to be conveyed at close, which is anticipated in the third quarter of 2007, Forest City will demolish 984 housing units and construct 759 replacement units for an end-state housing unit count of 917 military family homes. The Phase II Marine Corps housing privatization project represents a development cost of approximately $385 million. Along with the Phases I and II Navy and Phase I Marine Corps privatization projects, the Phase II Marine Corps project will bring Forest City’s total end-state count to 6,568 housing units in the State of Hawaii.
Forest City has also been selected to enter into exclusive negotiations for the family housing at Naval Activities Station (NAS) Mid-South in Millington, Tennessee, which would add a second phase to the Midwest Family Housing, LLC partnership with the Navy. A total of 401 existing units will be transferred, with 152 units slated for demolition, 73 units of new construction, 58 renovations, four divestitures and 187 no-work units. The end-state unit count is planned to equate to 318 units, representing a total development cost of approximately $38.6 million. The Phase II closing, which is anticipated to occur later this year, will bring the total Midwest end-state count to 1,976 family housing units spanning Illinois, Indiana and Tennessee.
About Forest City Military Communities, LLC
Forest City Military Communities, LLC, a wholly owned subsidiary of Forest City Enterprises, Inc., focuses on developing, managing and maintaining high-quality communities for military members and their families.
About Forest City Enterprises, Inc.
Forest City Enterprises, Inc. is a $9.2 billion NYSE-listed national real estate company. The Company is principally engaged in the ownership, development, management and acquisition of commercial and residential real estate and land throughout the United States.
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