Database to track performance of multi-family market.

The Multifamily Housing Institute, a group of 80 leading organizations active in the multi-family housing business, has announced it is beginning development of an on-line database that will track the performance of multi-family properties and loans nationwide. The system is known as Aptdata, or the Apartment Performance and Trends DataSource.

When the system is up and running next spring, users will be able to log on and obtain aggregated statistical data on the performance of about 3.4 million units of housing in 29,000 properties. This represents about 40 percent of the larger multifamily properties and loans in the U.S.

Triggering the start of development is a set of agreements the Institute signed recently with the U.S. Department of Housing and Urban Development, the Urban Land Institute, Freddie Mac, Fannie Mae and others to contribute dollars and data to the on-line system.

These major sponsors of Aptdata have joined with other members of the Multifamily Housing Institute to make an original investment in the system of more than $3 million. A $1.5 million contribution by HUD matches, on virtually a dollar-for-dollar basis, private sector investments of $350,000 by ULI, $100,000 by Freddie Mac and $100,000 by Fannie Mae, as well as $1 million already invested by Multi family Housing Institute members to design the system, test its feasibility and identify data contributors. A $50,000 Fannie Mae challenge grant in 1995 helped seed the Multifamily Housing Institute in its early stages.

Data contributors include HUD, Fannie Mae, Freddie Mac and the USDA Rural Housing Service plus major owners and managers of apartment properties such as NHP Incorporated, Insignia Financial, Boston Financial, Equity Residential and Trammel Crow Residential. Also contributing data are major non-profit owners such as The Enterprise Foundation's Enterprise Social Investment Corp. and the National Equity Fund of the Local Initiatives Support Corporation (LISC).

Institute Executive Director Matthew B. Slepin said, "Many of multi-family housing's leading public, private, and non-profit organizations have come forward today to capitalize the development of Aptdata and contribute their property and loan data. They are helping to bridge a huge information gap and build an important piece of infrastructure for the entire industry."

"The easy and widespread availability of industry-wide performance data through Aptdata will benefit multi-family owners, lenders, investors, property managers and loan servicers," he said. "It will also benefit taxpayers who have an interest in the future of multi-family housing through Federal and state housing programs and the stability and efficiency of the banking and financial systems."

Georgia Murray, president of the Institute and senior vice president of Boston Financial Company said, "We are witnessing the emergence of a now information paradigm for real estate, The launch of Aptdata marks a breakthrough in industry cooperation as well as technological prowess. The Institute has devised a way for the real estate industry to be comfortable with sharing its proprietary information through Aptdata."

The system's key confidentiality measure allows users to see results aggregated from 10 or more properties only, and never releases information on individual assets. This protects the proprietary nature of portfolio information shared through Aptdata.

The Multifamily Housing Institute also announced that it is teaming up with the Urban Land Institute in a formal affiliation designed to advance the mission of both organizations. ULI's huge membership base will assist the Multifamily Housing Institute in its efforts to collect and distribute performance information through Aptdata. The link will add a real-time dimension to ULI's research capabilities.

"The Urban Land Institute is proud to support this public/private initiative," said Joseph C. Canizaro, ULI's president. "Although we have long provided objective information to the real estate industry, this on-line database is a quantum leap forward in providing a reliable benchmark for investment and decision making. With instant access to real time information, we can increase the quality and profitability of rental apartments in the U.S."

A Capital Markets View

Michael R. Sears, a Bear, Stearns & Co. managing director and member of the Multifamily Housing Institute's executive committee, said, "Properly working capital markets need timely, reliable information. The real estate industry will see more sustained capital flows at more efficient costs if institutional investors have access to the information that will be available soon from Aptdata."

He added that the capital markets and rating agencies will use Aptdata extensively in securitizing commercial real estate through CMBS and REITS.

The Public Policy View

Assistant Secretary for Housing and FHA Commissioner Nicolas P. Retsinas announced HUD's contribution of funding and data to the system, saying the public policy implications of this venture are great.

"The broad and easy access to multifamily performance information through Aptdata will help the industry to act effectively as Federal and state housing programs move into the next century," Retsinas said. "Community-based non-profit owners are an important part of affordable housing's future. The new database will offer these organizations easier access to the system and provide them with information that will assist them in the acquisition, financing and management of housing communities."