Cypress Equity and LWK Form JV to Drive Workforce Housing Density Strategy
Cypress Equity Investments (“CEI”), a leading institutional multifamily developer and real estate investment firm, and LightWell-Keystone (“LWK”), a real estate private equity firm focused on attainable, value-add multifamily assets, are excited to announce a strategic partnership designed to address the growing workforce housing shortage in Los Angeles. This collaboration aims to capitalize on a recent state law that allows investors to add new units to existing multifamily properties, increasing housing density in an efficient and effective manner.
The newly formed partnership combines the strengths of CEI’s 20+ years of multifamily development experience in Southern California with LWK’s proven expertise in acquiring, improving, and operating value-add multifamily assets. Together, they plan to target high-density, value-add workforce housing opportunities in the heart of Los Angeles, ensuring more affordable living options for the city’s residents.
“We are thrilled to join forces with LWK on this event-driven opportunity to address the critical shortage of multifamily housing throughout Los Angeles,” said Michael Sorochinsky, Founder and Chief Executive Officer of Cypress Equity Investments. “Leveraging our extensive development track record along with LWK’s acquisition capabilities and existing portfolio, we are poised to take full advantage of the legislative changes that allow for the addition of new units to existing multifamily assets. This collaboration enables us to bring much-needed affordable housing units to market at scale.”
The partnership aims to utilize the recent state legislation, which incentivizes the addition of new units to existing multifamily properties, to drive significant growth in the Los Angeles housing sector. This approach allows Cypress Equity and LWK to address the demand for affordable workforce housing while ensuring the preservation and enhancement of existing multifamily communities.
“This new legislation is a game-changer for housing development in California, and we’re excited to pursue this opportunity alongside Cypress Equity, an industry leader in multifamily development,” said Austin Nissly, Co-Founder and Partner of LWK. “The ability to add density to existing assets offers a powerful solution to the housing crisis in Los Angeles and the broader California market. Together with CEI, we are confident in our ability to bring forward the necessary density to meet the needs of today’s housing market.”
Cypress Equity’s leadership in Southern California’s multifamily development landscape is an invaluable asset for this partnership. With a proven history of successful projects, CEI’s experience will be critical in ensuring the execution and scalability of the partnership’s strategy. LWK, on the other hand, brings its deep knowledge of identifying underperforming assets with potential for improvement, further bolstered by its expertise in adding density to properties to meet current housing needs.
The combined efforts of CEI and LWK will focus on scaling LWK’s current portfolio of 200 multifamily units with an ambitious goal of reaching 5,000 units over the next five years. This aggressive growth plan reflects the urgency of meeting Los Angeles’ escalating housing demand, and the partnership is committed to bringing much-needed density and workforce housing to the market in a timely and impactful manner.
Cypress Equity’s track record speaks for itself, with 156 projects and 21,000 multifamily units developed across the United States since its inception in 2001. The company has managed over $13 billion in asset value, and its investments have consistently delivered exceptional returns. On average, CEI’s realized investments have achieved an equity-weighted average internal rate of return (IRR) of 40.1% and an equity multiple of 2.51x, underscoring its expertise and successful track record in the multifamily development space.
LWK, founded in 2024, is focused on the acquisition, renovation, and management of multifamily assets in Los Angeles. The firm targets underperforming properties with untapped potential, utilizing a combination of operational improvements, value-add renovations, and density enhancement strategies. With the new legislative changes in place, LWK aims to drive significant value for both its investors and the communities in which it operates by creating affordable, high-quality housing solutions.
As part of their strategy, LWK seeks to add new units to its existing portfolio, enhancing the overall density and livability of these properties. The firm’s expertise in multifamily asset management and value-add renovation will play a crucial role in realizing the potential of each asset, and its commitment to adding workforce housing to the Los Angeles market aligns with the region’s growing need for more affordable options.
With Cypress Equity’s established reputation for multifamily development and LWK’s focus on value-add opportunities, this partnership represents a significant step forward in addressing the housing crisis in Southern California. By leveraging new state legislation, adding density to existing properties, and prioritizing workforce housing, the joint venture is poised to deliver scalable solutions that will help shape the future of multifamily housing in Los Angeles.
In conclusion, the strategic alliance between Cypress Equity and LWK promises to play a pivotal role in tackling the housing shortage in Los Angeles. By combining their expertise and leveraging the legislative framework to add density to multifamily properties, they aim to deliver thousands of new, affordable housing units in one of the country’s most challenged housing markets. The partnership underscores both companies’ commitment to improving housing availability and affordability in Southern California.
