Answering the call to build permanent housing in one of the
fastest-growing cities in the United States, the City of Williston today
announced that affiliates and clients of Kohlberg Kravis Roberts & Co
("KKR") including KKR Financial Holdings LLC ("KFN"), along with
co-investors Pfeffer Capital and CP Realty, have acquired land to
develop a high quality, permanent residential community in Williston,
North Dakota. Financial terms of the transaction were not disclosed.
Ralph Rosenberg, KKR's Head of Real Estate (Photo: Business Wire)
"Williston is one of the fastest growing cities in America and we are
dedicated to building a long-term sustainable community. We are thrilled
to work with new partners like KKR, Pfeffer Capital and CP Realty to
provide the quality housing alternatives we need to support the demand
created by our thriving economy," Ward Koeser, Mayor of Williston, said.
The project, The
Ridge at Harvest Hills, includes 164 acres of land overlooking the
city of Williston. Construction of infrastructure for the current phase
is under way and will support development of up to 330 apartments which
are scheduled to commence in Spring 2013 plus completion of lots
intended for sale to homebuilders for construction of 500 single family,
townhome, and duplex homes.
The Ridge at Harvest Hills will represent an evolution in housing stock
and community planning for the city as developers and public officials
worked together to include parks, recreation, and open space.
Furthermore, the community was planned to slow or divert commercial
traffic to further enhance the suburban feel of safety and security for
its inhabitants. Importantly, and unlike much of the surrounding land,
The Ridge at Harvest Hills is fully entitled and has immediate access to
utilities so the new community can help solve the city's near-term
housing shortage as well as long-term community demands.
The Ridge at Harvest Hills is ideally located in close proximity to the
new Sand Creek Town Center retail development, the new office complexes
of major oil services firms, the municipal golf course, Wal-Mart and an
elementary school. Creating a new, quality neighborhood to attract
families is a key step in the sustainable development of Williston where
an estimated 15,000 oil and gas professionals are living in various
forms of temporary housing including "man-camps," RVs and hotels.
"The Ridge at Harvest Hills represents a major investment that will help
the city of Williston meet its current and long-term housing needs,"
Governor Jack Dalrymple said. "The state is doing its part by
facilitating greater development of affordable housing in our
oil-producing region and in fast-growing communities throughout North
Bakken Formation & Employment
Western North Dakota is home to the Bakken formation, which occupies
about 200,000 square miles of the subsurface of the Williston Basin,
underlying parts of Montana, North Dakota, and Saskatchewan. The Bakken
is well-known to be a prolific source rock for oil and now natural gas.
A 2011 State of North Dakota study revised the original estimate by the
U.S. Geological Survey on the amount of oil that could be recovered -
from 3.0 to 4.3 billion barrels to over 10 billion barrels. The positive
outlook led to a surge in drilling and production in the Bakken. There
are currently approximately 180 drilling rigs operating in the state and
the City of Williston estimates that the next 10 years could see as many
as 20,000 wells drilled, resulting in an additional 10,000 - 20,000 new
jobs in Williston alone.
Earlier this year North Dakota surpassed Alaska and became the country's
second-largest oil producer behind Texas. In 2011, the average wage in
the oil & gas extraction industry in North Dakota was $89,020, far
exceeding the statewide average of $49,914, according to the North
Dakota Petroleum Council. As a result of the surge in demand and the
well-paying jobs, the state's unemployment has plummeted to 3%,
according to the Bureau of Labor Statistics release from July 2012.
Ralph Rosenberg, Global Head of KKR's Real Estate Team, stated: "This is
a long-term investment to support the structural needs of a growing
community. Because of the energy boom, North Dakota has had an influx of
new residents and our experience in the unconventional oil and gas
business gives us confidence that this is not merely a temporary
development. While Williston does have a supply of short-term housing,
the city suffers from a shortage of sustainable communities that
encourage employees to move their families or start them and reside
permanently in Williston. The Ridge at Harvest Hills will be a true
neighborhood, unlike any in the area, that solves a dire housing
shortage and supports Williston's thriving economy."
John Pfeffer stated: "Our interest in investing in the technology-driven
revolution in tight oil and gas production led us to Williston and the
vision to create a substantial, attractive and permanent new
neighborhood for families in this exciting and friendly town. Teaming up
with world-class partners KKR and CP Realty makes achieving this vision
possible. We are also tremendously grateful to the City of Williston for
the incredibly welcoming framework they provide for entrepreneurs to
Mark Falcone, Co-CEO of CP Realty stated: "We are thrilled to be
offering this fast growing community a neighborhood which will assist in
the region's efforts to recruit the talent and leadership necessary for
this economy to continue its robust growth."
Simpson Thacher Bartlett LLP served as legal Counsel to KKR.
Greenberg Traurig LLP and Moye White LLP served as legal counsel to and
Turn-Key Partners advised affiliates of Pfeffer Capital.
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a
leading global investment firm with $66.3 billion in assets under
management as of September 30, 2012. With offices around the world, KKR
manages assets through a variety of investment funds and accounts
covering multiple asset classes. KKR seeks to create value by bringing
operational expertise to its portfolio companies and through active
oversight and monitoring of its investments. KKR complements its
investment expertise and strengthens interactions with investors through
its client relationships and capital markets platform. KKR is publicly
traded on the New York Stock Exchange (NYSE: KKR). For additional
information, please visit KKR's website at www.kkr.com.
Photos/Multimedia Gallery Available: http://www.businesswire.com/multimedia/home/20121114005675/en/
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