Apollo funds commit $1.34B to UDR apartment venture with 7%-7.5% repurchase option

Daily Network reporting shows Apollo funds are committing $1.34 billion for a two-thirds interest in a $2 billion venture holding 19 UDR apartment communities.

UDR keeps the remaining one-third, manages the 19 communities for a fee, and holds an option to repurchase Apollo's interest after five years at a 7% to 7.5% return. The option is exercisable from the fifth anniversary and sets a price for Apollo's capital.

If UDR exercises the option, Apollo's capital is repaid at that 7% to 7.5% band and UDR regains the two-thirds stake. If UDR does not exercise, Apollo remains a two-thirds owner while UDR keeps the management fee and one-third economic interest.