Author: ipgocorp

WINSTON-SALEM, NC – Northridge Capital closed on its investment in 757 North Apartments, a $14.9 million multifamily construction development in the city of Winston-Salem, North Carolina. Northridge Capital established a joint venture partnership for the project with local developer, Laurel Street Residential, in 1st quarter of 2016, breaking ground in February.

Upon completion, 757 North will total 78,694-square feet and will sit on a 2.09-acre lot 3.4 miles southeast of Wake Forest University in Downtown Winston-Salem. The four-story apartment building will offer 115-units, of which 29 are workforce housing units and 86 market rate units. The unit mix will include studio, one-bedroom and two-bedroom units. Apartments will offer hardwood flooring and 9- and 10-foot ceilings, stainless steel appliances, granite countertops, in-unit washers/dryers, and private balconies. Residents will also enjoy generous amenity spaces, including a fully-equipped fitness center, café and coffee bar with Wi-Fi access, and game room with outdoor patio.

Adjacent to the property lies the 175-acre Wake Forest Innovation Quarter, which currently employs 3,000 people and is projecting an increase to 10,000 by 2017 and 25,000 at total build out. 757 North will be one of the closest, Class A apartment communities to the Wake Forest Innovation Quarter, offering premier living options for young working professionals and families looking to work/live/play in an urban environment.

Equity for the project is being provided by Northridge Capital, LLC, on behalf of its offshore investors. Debt financing for the project has been provided by NewBridge Bank and the City of Winston-Salem.

(RECAP: On October 24, HUD published in the Federal Register the initial implementation guidance for the Housing Opportunity through Modernization Act (HOTMA). HOTMA, which President Obama signed into law in July, makes several modifications to housing assistance programs, including streamlining Housing Choice Voucher (voucher) program inspections, simplifying the requirements for project basing vouchers, and providing public housing agencies (PHAs) greater flexibility to transfer funding between their operating and capital funds. HUD’s guidance clarifies which statutory provisions went into effect immediately upon the President signing HOTMA into law and which provisions will be phased in as HUD promulgates further regulations.)

TAMPA, FL – Avesta Communities, in partnership with New York-based GRJ, has purchased Arbors at Carrollwood, an apartment home community off Ehrlich Road in the Carrollwood neighborhood just north of Tampa.  The Arbors is a 390-unit fractured condo community, which will be managed by Avesta’s in-house property management division, Avesta Homes.

Arbors at Carrollwood offers one to three-bedroom apartment homes, a swimming pool, a waterfall hot tub, an expansive fitness center, clubhouse and business center, garages, boat parking, tennis court, dog park, and picnic areas for residents to enjoy. 

“We see Tampa as an emerging and strengthening market,” said Gregory Jones of GRJ, a real estate company that owns, develops and operates multi-family and mixed-use assets. “We’re excited about this purchase and working with Avesta to provide a superior apartment living experience for our residents.”

Avesta plans on a multimillion-dollar capital improvement program, enhancing the already high quality of the property by making interior renovations to various common areas, as well as the apartment homes.

“We are excited to expand even further in the Tampa Bay market,” said Avesta partner, Rachel Ridley.  “The economy here is flourishing, with a fast-growing job market and booming population, which are outpacing the national average.”

With the addition of this new apartment home community, Avesta now owns more than 1,500-units in the Tampa Bay area.  Arbors at Carrollwood is conveniently located near Avesta’s Tampa support office near North 56th Street and Hillsborough Avenue.

WASHINGTON, DC – Builders report that the single-family 55+ housing market is holding strong in the third quarter, according to the National Association of Home Builders’ (NAHB) 55+ Housing Market Index (HMI) released. The index had a reading of 59, up two points from the previous quarter and the 10th consecutive quarter with a reading above 50.

“Builders and developers for the 55+ housing sector tell us that business is solid right now and they expect that trend to continue through the rest of the year,” said Jim Chapman, chairman of NAHB’s 55+ Housing Industry Council and president of Jim Chapman Homes LLC in Atlanta.

There are separate 55+ HMIs for two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each 55+ HMI measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor (high, average or low for traffic). An index number above 50 indicates that more builders view conditions as good than poor.

Two of the three index components of the 55+ single-family HMI posted an increase from the previous quarter: Present sales increased two points to 63 and traffic of prospective buyers rose five points to 47. Meanwhile, expected sales for the next six months dropped four points to 65.  

The 55+ multifamily condo HMI rose one point to 48. The index component for present sales increased two points to 51, while expected sales for the next six months fell three points to 51 and traffic of prospective buyers remained even at 38.

All the four indices tracking production and demand of 55+ multifamily rentals decreased in the third quarter. Present production fell three points to 48, expected future production decreased seven points to 49, current demand for existing units dropped nine points to 59 and future demand fell eight points to 59.

“The 55+ housing market continues on a steady path toward recovery, much like the overall housing market,” said NAHB Chief Economist Robert Dietz. “Older home owners are able to take advantage of low mortgage rates and rising home prices, enabling them to sell their current homes and buy or rent a home in a 55+ community.”

For the full 55+ HMI tables, please visit www.nahb.org/55hmi

TRI-CITIES, WA – Security Properties and an institutional equity partner purchased Riverpointe Apartments, a 228-unit Class B multifamily property located in Richland, WA for $22,300,000 and Crosspointe Apartments, a 200-unit Class B Multifamily property located in Kennewick, WA for $19,000,000.

Both assets are 1996-vintage garden-style apartment communities. The well-located assets have been well maintained, but have had little in the way of aesthetic enhancements since they were built.  By renovating the unit interiors and improving amenity areas and building exterior, Security Properties will elevate these properties to a higher class product while providing residents with a superior standard of living.

Barrett Sigmund, Sr. Director at Security Properties states that, “these acquisitions represent Security Properties continued effort of locating value in a competitive multifamily space. While the DOE’s massive Hanford Site contributes significantly to the highly educated work force and high median incomes in Richland and Kennewick, Benton County has quietly seen growth in healthcare, education and agriculture as well.  When combined with relatively low apartment supply, we expect this market to continue to perform well. At an average basis of $96,495/unit and highly favorable cap rates relative to our debt rates, these investments will enjoy excellent risk adjusted returns to our investors.”

Riverpointe and Crosspointe were financed with assumed HUD mortgages at an attractive 3.42% average fixed rate. These assets will be managed by Security Properties-affiliate Madrona Ridge Residential.

ARVADA, CO – Prescient, a fully integrated, proprietary and patented design, engineering, manufacturing and installation solution for the construction industry, announced the completion of two senior housing projects located in Stuart, Fla., and Lonetree, Colorado.

This marks Prescient’s entry into the senior living category, increasing the company’s presence across the multi-unit housing spectrum in five categories, including: market-rate apartments, student dorms, hotels and armed forces housing.

The company’s most recent senior living project, Providence Living at Stuart, owned by Providence One Partners LLC and located in Stuart, Fla., is a 108,000-square-foot, two-story structure that includes 68 assisted living units and 32 memory care suites. The project was designed by Baker Barrios and constructed with F.M. Harvey Construction.

The company’s first senior living project, MorningStar at Ridgegate, owned by MorningStar Senior Living, features one-story, three-story and five-story interconnected wings built using Prescient’s proprietary software and framing system. The 250,000-square-foot project consists of 124 independent living units, 71 assisted living units and 29 memory care suites. The project was designed by Lantz Boggio Architects, built by Haselden Construction and developed in conjunction with Jirsa Hedrick Structural Engineers.

“Our system is ideal for senior living projects,” said Satyen Patel, chairman and CEO of Prescient. “The Prescient platform is significantly more cost-efficient compared to concrete or wood, and our ability to accommodate different types of units allows us to trim months off typical construction schedules, which means minimized neighborhood disruption and an expedited track to earnings, return on investment and project internal rate of return for developers.”

Prescient structures consist of a combination of pre-assembled steel posts, trusses and panels that are custom-manufactured using Prescient’s proprietary design software. The system is a viable option for senior housing projects because it is a non-combustible solution that minimizes disruption in the areas surrounding the construction zone and reduces the need for rework, helping owners meet timelines and budgets.

Prescient, which recently expanded its Arvada headquarters and manufacturing facility and broke ground on an East Coast manufacturing plant in Mebane, N.C., is on track to complete nearly 2 million square feet of projects during 2016 in market-rate apartments, hotels, armed forces housing, student housing and senior living segments in Colorado, Florida, Georgia, Illinois, Missouri, Nebraska, North Carolina, Oklahoma and Texas.

(RECAP: The Gramercy Row apartment building in Roanoke has been a work in progress for more than two years. But last week, the building officially opened in the 400 block of Williamson Road. The building is one of the few newly built properties downtown in years. The apartments were built on top of a parking lot. Developer Lucas Thornton and his Hist:Re Partners LLC purchased the lot from the city in 2014 with the intention of constructing an $8 million residential and commercial project. The 82 one- and two-bedroom apartments, which range from 700 to 1000 square feet, were constructed with modern amenities and Cox Gigablast internet service.)

COLLEGE PARK, MD – Greystar Real Estate Partners, a global leader in the investment, development, and management of rental housing properties, announced that the Company has partnered with real estate private equity firm Rockpoint Group to acquire University View in College Park, Maryland.

The joint venture plans to significantly update the unit interiors and common areas to provide accommodations to compete with more recent student housing deliveries in the submarket.

The improvements include a full interior upgrade to all units, inclusive of wood-style plank flooring, new countertops, stainless steel appliances, updated furniture packages, upgraded hardware and lighting, significant enhancements to the common areas/amenity spaces and conversion of the existing pool area into a resort style amenity.

“Greystar and Rockpoint are able to add value through significant capital renovations, while still maintaining attainable rents for students,” said Cliff Chandler, Managing Director of Investments for Greystar.

“We look forward to offering the next-generation of apartment amenities designed specifically to meet the needs of students,” said Michelle Fuller, Managing Director of Real Estate for Greystar.

Located at 8204 Baltimore Ave., the student housing property is split into 2 separate buildings, with a total 1,573 beds (507 units) and 9,218 square feet of ground floor retail space. Its proximity to the University of Maryland offers students easy access to campus via a pedestrian bridge, as well as an on-site university shuttle service to campus and Downtown College Park. Additionally, University View is within walking distance to numerous restaurants and entertainment venues along Baltimore Avenue.

ATLANTA, GA – Preferred Apartment Communities announced the acquisition of Galleria 75, an outstanding well-located seven acre site that was recently rezoned to allow mixed-use redevelopment, including up to 600 multifamily units. 

The property is strategically located immediately north of the Encore multifamily property development and south of the Cobb Energy Performing Arts Center off Cumberland Boulevard in Cobb County, Georgia.     

“The property currently maintains 110,000 square foot office property, which offers a unique combination of in-place yield and future redevelopment potential,” said Daniel M. DuPree, the Chief Investment Officer for PAC. 

John A. Williams, PAC’s Chairman and Chief Executive Officer, added, “Concurrent with our acquisition, we were able to rezone the property to allow mixed-use redevelopment, including up to 600 multifamily units. Because the existing office is stabilized and generating excellent cash flow we have the flexibility to continue to own and operate the property on an “as-is” basis until such time we believe the market will reward us for adding density.”

PAC acquired this property through a wholly-owned subsidiary and financed the acquisition by assuming the existing first mortgage loan from RGA Reinsurance Company, with an outstanding principal balance of approximately $5.9 million that has a maturity date of July 1, 2022 and a fixed interest rate of 4.25% per annum.  There are no loan guaranties provided by PAC.

Preferred Apartment Communities acquires and operates multifamily properties in select targeted markets throughout the United States.

WASHINGTON, DC – Persistent supply shortages throughout the country led to slightly faster home price appreciation during the third quarter, according to the latest quarterly report by the National Association of Realtors. The report also revealed that seven of the 10 most expensive housing markets in the U.S. are in the West, including San Jose, California, which had a median single-family home price of $1 million for the second straight quarter.

The median existing single-family home price increased in 87 percent of measured markets, with 155 out of 178 metropolitan statistical areas (MSAs) showing gains based on closed sales in the third quarter compared with the third quarter of 2015. Twenty-two areas (12 percent) recorded lower median prices from a year earlier.

There were a growing number of rising markets in the third quarter compared to the second quarter of this year, when price gains were recorded in 83 percent of metro areas. Twenty-five metro areas in the third quarter (14 percent) experienced double-digit increases – unchanged from the second quarter of this year. A year ago, 21 metro areas (12 percent) saw double-digit price appreciation.

Lawrence Yun, NAR chief economist, says prospective buyers faced a very challenging market during the third quarter. “Mortgage rates around historical lows and solid local job creation created a winning formula for sustained home-buying demand all summer long,” he said. “Unfortunately for house hunters in several of the top job producing metro areas around the country, deficient supply levels limited their options and drove prices higher – especially in markets in the West and South.”    

The national median existing single-family home price in the third quarter was $240,900, which is up 5.2 percent from the third quarter of 2015 ($228,900) and surpasses this year’s second quarter ($240,700) as the current peak quarterly median sales price. The median price during the second quarter increased 4.9 percent from the second quarter of 2015.   

Total existing-home sales, including single family and condos, slid 2.2 percent to a seasonally adjusted annual rate of 5.38 million in the third quarter from 5.50 million in the second quarter of this year, and are 0.4 percent lower than the 5.40 million pace during the third quarter of 2015.  

“After climbing to their highest annual pace in over nine years in June, sales sputtered in the third quarter because inventory could not catch up with what was being quickly sold,” said Yun. “Only a decent rebound in September kept the monthly and annual sales declines from being even larger.”

At the end of the third quarter, there were 2.04 million existing homes available for sale, which was 6.8 percent below the 2.19 million homes for sale at the end of the third quarter in 2015. The average supply during the third quarter was 4.6 months – down from 4.9 months a year ago.

Despite faster price growth last quarter, the decline in mortgage rates and an uptick in the national family median income ($70,306) slightly improved affordability compared to a year ago. To purchase a single-family home at the national median price, a buyer making a 5 percent down payment would need an income of $51,661, a 10 percent down payment would require an income of $48,942, and $43,504 would be needed for a 20 percent down payment.

“If mortgage rates start to rise heading into next year, prospective buyers could face weakening affordability conditions in their market unless supply dramatically improves,” added Yun. “That’s why it’s absolutely imperative that homebuilders ramp up the production of more single-family homes to meet demand and slow price growth.”

The five most expensive housing markets in the third quarter were the San Jose, California, metro area, where the median existing single-family price was $1,000,000; San Francisco, $835,400; urban Honolulu, $745,300; Anaheim-Santa Ana, California, $740,100; and San Diego, $589,300.

The five lowest-cost metro areas in the third quarter were Youngstown-Warren-Boardman, Ohio, $90,300; Cumberland, Maryland, $94,400; Decatur, Illinois, $99,400; Elmira, New York, $109,400; and Rockford, Illinois, $111,900.

Metro area condominium and cooperative prices – covering changes in 59 metro areas – showed the national median existing-condo price was $225,100 in the third quarter, up 4.6 percent from the third quarter of 2015 ($215,200). Forty-one metro areas (69 percent) showed gains in their median condo price from a year ago; 17 areas had declines.

NAR President Tom Salomone, broker-owner of Real Estate II Inc. in Coral Springs, Florida, says the Federal Housing Administration’s recently-announced rule change to lower the owner-occupancy requirement for approved condominium buildings from 50 percent to 35 percent under certain conditions is a step forward for prospective buyers considering a condo.

“Condos have typically been an attractive and viable option for first-time buyers, and recent NAR data is showing that they’re having a little more success,” he said. “With this lower owner-occupancy requirement, Realtors® will have more options for their clients looking to purchase a condo with an FHA mortgage. While we believe all condo buildings should have the rules applied to them equally, we also believe FHA has heard the concerns of Realtors and is moving in the right direction.”

Regional Breakdown

Total existing-home sales in the Northeast dropped 7.5 percent in the third quarter and are now 1.9 percent below the third quarter of 2015. The median existing single-family home price in the Northeast was $272,600 in the third quarter, up 1.2 percent from a year ago.           

In the Midwest, existing-home sales decreased 4.2 percent in the third quarter but are 1.0 percent above a year ago. The median existing single-family home price in the Midwest increased 5.6 percent to $191,200 in the third quarter from the same quarter a year ago.

Existing-home sales in the South declined 2.7 percent in the third quarter and are 0.9 percent lower than the third quarter of 2015. The median existing single-family home price in the South was $213,700 in the third quarter, 6.5 percent above a year earlier.

In the West, existing-home sales increased 4.6 percent in the third quarter and are unchanged from a year ago. The median existing single-family home price in the West increased 7.6 percent to $349,200 in the third quarter from the third quarter of 2015.