Momentum in Northern New Jersey’s multifamily market continues unabated, with investors aggressively pursuing opportunities, and developers actively launching projects along the Hudson River Gold Coast and west along transit lines. Heading into the heart of 2015, we are seeing demand drive up sales volume and values, and push cap rates down to historically low levels. Current investment velocity follows a strong 2014 capital markets performance. Last year, $1.3 billion in multifamily sales (including transactions of $10 million or more) marked the highest volume since 2007, and compares to approximately $900 million annually in both 2012 and 2013. For context, the market saw only $169 million in annual trades during the depth of the recession in 2009. The “buy” side today is dominated by institutional advisors, particularly for Class A apartment communities. Additionally, we are seeing privately held firms and raised funds making big splashes with value-add and Class B product. Northern New Jersey’s active sellers include developers and private owners looking to take advantage of valuations that have appreciated to historically high levels, as well as institutions that are cycling assets at the end of their traditionally long-term investment horizons. Additionally, multifamily cap rates have dropped consistently in Northern New …
New York City multifamily has historically been a darling of the real estate industry — and for good reason. It is arguably the most sought-after investment product type within commercial real estate investment’s most targeted city. It is the perfect demographic storm on the demand side: two-thirds of the population rent versus own; the population is arguably the best educated and includes the highest income generators in the nation; and the market continues to exhibit vast growth in household creation and population. Not to mention, the supply side is both geographically and politically constrained. These limitations are further exacerbated by very high costs to build. However, even with the dual push of supply and demand continuing to be in investors’ favor citywide, there are some areas that are softening. Two areas that seem to be softening are luxury condominiums in Manhattan and rental product in Long Island City (Queens) and the downtown Brooklyn area. Manhattan Luxury Condo Sales Slowing Manhattan is often a trendsetter that is months and years ahead of the rest of the country when it comes to real estate trends, and the return of the luxury condominium market is a prime example of this. Some 2,500 units were …
Multifamily housing is coming of age in New Mexico, and the Millennial generation is spurring the growth. The old adage of “location, location, location” is ever present as the placement of a property in relation to cultural, educational, entertainment and natural amenities becomes a major factor in the value of the property. The ability to walk and bike to social amenities like restaurants, theaters and schools is, and will continue to be, very high on the list of importance for members of this generation in New Mexico. There is not only a distinguishable difference in occupancy rates for units scoring high on Millennial’s wish lists, but the income for these units is between 20 percent and 24 percent higher than those with lower scores. While newly constructed and refurbished multi-housing units often appeal to Millennials, all of New Mexico is experiencing high occupancy rates throughout the multifamily market. This push on availability is fueling an environment that will continue to encourage increasing rents and new construction. Though the sale of multifamily properties was deeply affected by the recession, a market shift in 2013 has allowed the multifamily market to regain its footing with a two- to three-times increase in sales …
INDIANAPOLIS — American Campus Communities Inc. will break ground on Sunset Student Residences, a 633-bed sophomore residence hall on the campus of Butler University in Indianapolis, this month. The $40 million facility will open in August 2016. The site previously had been a parking lot. Sunset Student Residences is the result of a partnership between ACC and Butler University. ACC will build and maintain the facility, while Butler will provide staff to manage the building. Sunset Student Residences will feature suites of three- and four-bedroom floor plans.
CHICAGO — Interra Realty has brokered the $1.2 million sale of a 13-unit, walk-up style apartment building at 1614 N. Harding Ave. in Chicago’s Humboldt Park neighborhood. The property features studio, one-, two- and three- bedroom layouts. Ten of the units have recently been renovated and the property. Joe Smazal and James Clough of Interra Realty represented both the buyer and the seller in the transaction.
CHICAGO — Oak Grove Capital has arranged a $27 million adjustable-rate mortgage through Freddie Mac for Algonquin Square Apartments, a 220-unit multifamily property located in Chicago’s western suburbs.The property was built in 2012 and 2013. The loan was for a joint venture between Marquette Cos., EJ Plesko & Associates and American National Insurance, which served as the limited partner.The new loan allowed for the payoff of the construction loan, municipal loans and further returned some of the original investment to the investor members. Scott Streiff of Oak Grove Capital arranged the seven-year loan that includes two years of interest-only payments and a 30-year amortization schedule.
WOODBURY, MINN. — Oak Grove Capital has arranged a $35.9 million FHA loan for Uptown at City Walk, a 245-unit multifamily apartment complex in Woodbury. Tim Leonhard, managing director of Oak Grove Capital, secured the interest rate modification loan for the undisclosed borrower.
This year, Forbes listed Houston as the fastest growing city in America, which is no surprise considering its 4.5 percent year-over-year job growth rate. Having created 667,800 new jobs and counting since 2005, Forbes considers Houston an economic powerhouse. Professionals old and new are drawn to the city not only for its positive economy, but for its diverse demographic and cultural scene. Due to the growing population, there is a demand for multifamily and mixed-use properties, and although the city has current concerns about dynamics and pricing of the oil and gas industry, there are several Houston submarkets that have been more resilient than others and continue to be ripe for development: The Galleria/Uptown Park, Greenway Plaza/Upper Kirby, downtown Houston and the Museum District/Montrose. The Galleria/Uptown Park The Galleria/Uptown Park submarket is home to some of Houston’s most prominent mid- and high-rise multifamily developments, with the highest net effective rent for greater Houston nearing $2.90 per square foot. The area is characterized by its blend of distinguished businesses and residential addresses with some of the area’s finest shopping, hotels, dining and night life. It’s a charismatic, urban community with an average per capita income higher than areas such as Buckhead …
SAN DIEGO — Strata Equity Group has received $494.8 million in acquisition financing to purchase a 12-property multifamily portfolio from Blackstone Real Estate Partners VII. The portfolio contains 4,635 units throughout Denver, Atlanta, Houston and Austin, Tex. The 12 separate, fixed-rate loans were arranged by HFF’s Mona Carlton, Luke Vanderpoel, Chad Russell, Kris Lowe and Ginger O’Reilly. They were placed with Freddie Mac’s CME Program. The securitized loans will be serviced by HFF through its Freddie Mac Program Plus Seller/Servicer program. “These acquisitions have expanded Strata’s national presence in line with our long-term investment strategy of delivering attractive, risk-adjusted cash yields in strategic growth markets to our investors,” says Carlos Michan, Strata’s CEO and founder. “Over the last five years, Strata has rebuilt its income property portfolio after having divested a majority of its assets during the last upcycle. These efforts have complemented Strata’s land banking and entitlement division.” The portfolio contains institutional-quality assets built between 1989 and 2012. Most of the properties will undergo a renovation to upgrade the common-area amenities and finishes within the units. “The location and vintage of these assets is appealing from an investment and portfolio diversification standpoint,” Michan continues. “The improvements will bolster demand …
FOREST PARK, ILL. — Interra Realty has brokered the $2.4 milion sale of the Forest Hall Apartments, a 39-unit apartment building located at 500 Des Plaines Ave. in Forest Park. The unit mix includes studio and one-bedroom apartments. The property is located within walking distance to the Blue Line train station and the Madison Street entertainment district. Joe Smazal and James Clough of Interra Realty represented both the undisclosed seller and the buyer.