Author: ipgocorp

CHATSWORTH, CA – Marcus & Millichap announced its Institutional Property Advisors (IPA) division closed the sale of Waterstone Apartment Homes, a 348-unit multifamily community in Chatsworth, California. The $72.5 million sales price equates to more than $208,000 per unit.

“Surrounded by some of the most coveted single-family home communities in the West San Fernando Valley, Waterstone benefits from excellent submarket fundamentals,” said Greg Harris, IPA executive director.

Harris, along with Ron Harris, IPA executive director, Kevin Green and Joseph Grabiec, IPA senior directors, and Paul Darrow, IPA director, represented the seller, and procured the buyer.

“Chatsworth’s highly rated public schools, low unemployment and strong projected household income growth, combined with low vacancy and a lack of new supply, make it an excellent place to invest in multifamily assets, especially large, high-end properties like Waterstone Apartment Homes,” said Ron Harris.

The property was built in 1971 at 9901 Lurline Ave. in Chatsworth. It is one block south of the 615,400-square-foot Westfield Topanga shopping mall and approximately one mile from the Chatsworth Metrolink station. Five major freeways and employers including Aerojet Rocketdyne, Anheuser-Busch, Boeing, Health Net, Nestlé and The Walt Disney Co. are within proximity.

“The acquisition gives new ownership the ability to complete a strategic renovation in a market where there is a significant affordability gap to home ownership and strong demand for high-end rental housing,” said Green.

The 250,428-net-rentable-square-foot property features a clubhouse with billiard tables, a large swimming pool and a spa, a lighted tennis court, a barbecue/picnic area, and a fitness center.

NEW YORK, NY – Mortgage rates moved modestly lower this week, with the benchmark 30-year fixed mortgage rate slipping to 3.62 percent, according to Bankrate.com’s weekly national survey. The 30-year fixed mortgage has an average of 0.20 discount and origination points.

The larger jumbo 30-year fixed nosed higher to 3.63 percent, while the average 15-year fixed mortgage rate held steady at 2.91 percent. Adjustable mortgage rates were mixed, with the 3-year ARM rising to 3.24 percent, while the 5-year and 7-year ARMs retreated to 3.09 percent and 3.28 percent, respectively.   

Mortgage rates were little changed ahead of a much-anticipated meeting of the Federal Open Market Committee, the Federal Reserve’s rate-setting committee. The Fed did not raise interest rates, despite giving an upbeat assessment of the economy. However, they did send a strong signal that a rate hike is coming perhaps as soon as December. In addition to pointing out that inflation remains below their intended target, the Fed’s economic projections released following the meeting revealed that they aren’t expecting core inflation to hit 2 percent until 2018. The combination of no rate hike now, low inflation, very modest increases in inflation, and a possible short-term rate hike later this year is good news for long-term bonds, and by extension, mortgage rates. Higher inflation erodes the value of the fixed payments bondholders receive, but projections of low inflation and measures to keep it in check tend to push yields lower. Mortgage rates are closely related to yields on long-term government bonds.

At the current average 30-year fixed mortgage rate of 3.62 percent, the monthly payment for a $200,000 loan is $911.54.

SURVEY RESULTS

30-year fixed: 3.62% — down from 3.64% last week (avg. points: 0.20)

15-year fixed: 2.91% — unchanged from last week (avg. points: 0.18)

5/1 ARM: 3.09% — down from 3.13% last week (avg. points: 0.25)

Bankrate’s national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in 10 top markets.

For a full analysis of this week’s move in mortgage rates, go to www.bankrate.com

The survey is complemented by Bankrate’s weekly Rate Trend Index, in which a panel of mortgage experts predicts which way the rates are headed over the next seven days. A little over half of respondents – 56 percent – predict mortgage rates will retreat further over the next week, while 33 percent expect mortgage rates to remain more or less unchanged. Just 11 percent forecast an increase in mortgage rates over the next seven days.

(RECAP: HUD today published a final rule to ensure that all individuals have equal access to many of the Department’s core shelter programs in accordance with their gender identity. HUD’s new rule will require a recipient, sub-recipient, or provider to establish, amend, or maintain program admissions, occupancy, and operating policies and procedures (including policies and procedures to protect individuals’ privacy and security), so that equal access is provided to individuals based on their gender identity. This requirement includes tenant selection and admission preferences.)

BLOOMINGTON, IN – Alex. Brown Realty and Asset Campus Housing announce the acquisition of The Fields, a student housing project near the main campus of Indiana University in Bloomington, Indiana. ABR Chesapeake Fund V, a value-add real estate fund sponsored by ABR, invested $11.7 million in the joint venture. The acquisition was financed with a first mortgage loan from Texas Capital Bank, N.A.

Built as a conventional apartment community between 1997 and 2001, the property was recently converted to a 537-bed student housing community by the prior owner and includes a resort-style pool, lap pool, two 24-hour fitness centers, a business and media center, a 10-acre park overlooking scenic ponds, and The Clubhouse–an elegantly renovated 1940’s barn with 24’ rafted ceilings.

“The Bloomington student housing market continues to be a strong performer,” stated Stephen Mitchell, EVP with Asset Campus Housing, noting the University’s steady enrollment growth and barriers to new supply in the market. “We believe The Fields will continue to benefit from its conversion to a student housing community,” added Mitchell. At closing, The Fields was 98% leased for the 2016-2017 school year.

The joint venture plans to complete $3.4 million of value-add improvements to cure deferred maintenance, upgrade select unit interiors and refresh the property’s curb appeal. “The property has strong in-place revenue,” commented Tom Burton, ABR’s chief investment officer. “Once the capital improvements are complete, the property will be more competitively positioned within the market and we expect to see healthy NOI growth.”

“ABR and Asset Campus Housing have successfully partnered in several student housing projects,” stated John Prugh, president and CEO of ABR. “They have a proven track record and are a strong joint venture partner.” The acquisition of The Fields represents the sixth joint venture between ABR and ACH.

PHILADELPHIA, PA – Campus Apartments, one of the nation’s largest providers of on- and off-campus student housing, announces today a development project with University of the Sciences that will begin to replace the University’s on-campus housing stock and help to bring new life to Woodland Avenue in the University City section of Philadelphia. The new 128,000-square-foot live-learn facility, located at 46th St. and Woodland Ave., will accommodate approximately 400 students and will include generous social, study, classroom and programming spaces, as well as ground floor retail space. The estimated $50 million development of the new residence hall marks the start of a multi-phase effort to improve facilities across the entire University over the next several years.

Slated for completion by August 2018, the project will deliver an on-campus residential facility to begin replacing the available housing at the University. The six-story building will include two-person semi-suites designed to serve the University’s first-year student population, two staff apartments, as well as 16,000 square feet of communal social and study lounges. The live-learn facility will feature 5,000 square feet of classroom space and new Resident Life office space for the University. In addition to University facilities, the building will include two ground floor retail spaces (2,700 square feet) along Woodland Avenue and a publicly accessible open courtyard. The building will incorporate numerous sustainable features to achieve Green Globe certification.

“The new first-year residence hall is the first of a multi-phase effort to improve the quality of our housing and learning facilities to enhance interaction and collaboration at the University and to attract more students to our institution,” said Dan Severino, Director of Facilities at University of the Sciences. “Through this project, we also strive to energize this corridor of Woodland Avenue and further integrate our campus and University with our neighboring community. The retail and public space will create a new hub within the community, which will benefit the neighborhood for years to come.”

The live-learn facility will be located on the site of the former Alexander Wilson Elementary School, which the University bought from the Philadelphia School District in 2014. Replacing the vacant structure, the new University development will provide the local community with new stores and meeting and green space, in addition to streetscape repairs and lighting. The University will also offer community-driven programming.

“This project will transform an underutilized site into a vibrant corridor by creating modern facilities for students to live and learn, and new retail and programming spaces for the local community,” said Daniel Bernstein, President and Chief Investment Officer at Campus Apartments. “The University’s long-term commitment to enhancing its campus will help attract and retain the best and brightest students. University of the Sciences is a great partner, and we’re excited to bring this new facility to students, university staff and community members in our hometown.”

Campus Apartments was awarded the residence project after a competitive RFP process. Campus Apartments and the University partnered with architect Design Collective and general contractor Torcon Construction for this development. Construction is set to begin in January 2017.

(RECAP: HUD’s recently released monthly Housing Scorecard points to new home sales, homeowner participation in loss mitigation programs, and declining foreclosure starts and completions as evidence that the housing market is steadily continuing to recover from the housing crisis. The report states new single-family home sales rose by 12.4 percent in July to 654,000, reaching the fastest pace since October 2007 and up over 31 percent from this point last year. According to the report, previously owned (existing) homes sales fell 3.2 percent in July to 5.39 million, down from 5.57 million in June and 1.6 percent lower than at this point last year. Despite the loss in momentum, existing home sales remained above 5.0 million for 16 of the past 17 months.)

OOLTEWAH, TN – Olympus Property expands their Tennessee portfolio with the acquisition of Legends at White Oak outside of Chattanooga, Tennessee.

Legends at White Oak is a brand new Class “A” apartment community comprised of 312 units. Completed in 2015, Legends at White Oak is situated on over 21 acres and boasts high quality construction with top-of-the-market finishes and amenities. Residents’ amenities include an expansive salt-water pool with sun ledge, modern fitness center, two fully stocked fishing ponds, business center, billiards room, and a poolside cabana with fire pit. 

“In addition to being an incredibly attractive asset, Legends at White Oak is perfectly situated near major job drivers within one of the best public school districts in Chattanooga,” said Ruyi Li, Acquisitions Manager for Olympus Property.

Units feature top-of-the-line finishes, including open floor plans with 9-foot ceilings, balconies with expansive views, oversized closets, stylish wood cabinetry in kitchens and baths, premium granite countertops, ceramic tile baths, faux wood blinds, washer and dryer, hardwood style flooring, ceiling fan with lights, and patios/balconies.

The Legends benefits from its highly convenient location and provides convenient access to Chattanooga’s largest employers in Downtown and along Highway 75/I-75. The $1 billion Volkswagen automotive plant and the Amazon distribution center each employ over 2,400 and are located within a five minute drive time. Additionally, the property is a short 15-minute drive to the urban core of Chattanooga.

“We are thrilled to be expanding our Tennessee portfolio in Chattanooga, a beautiful town attracting employers and families from across the nation,” said Anthony Wonderly, Principal of Olympus Property.

Legends at White Oak is the fourth property to be added to Olympus Property’s sixth fund. The investment structure will provide investors an opportunity to diversify among numerous multi-family assets providing immediate cash flow in strong markets throughout the United States.

JACKSONVILLE, FL – Watercrest Senior Living welcomed more than thirty residents to the official opening of Watercrest of San Jose Assisted Living and Memory Care Community in Jacksonville, Florida. The 79,000 square foot, 90 unit senior living community, features premium amenities, exceptional care and luxury residences set along the picturesque banks of Goodby’s Creek.

Watercrest of San Jose is a signature Watercrest product, offering 66 assisted living and 24 memory care apartments with spacious and upscale accommodations in a comfortable and classy design. Residents will enjoy pampering in elegant Spa W, savor private label Watercrest wines at the wine bistro, and relish the flavors of locally grown, seasonal ingredients and organic fare offered at multiple dining venues.

“Our team is thrilled to welcome the residents of Jacksonville into our Watercrest community to enjoy the rich, diverse lifestyles and exceptional care they deserve,” says Marc Vorkapich, Principal and CEO of Watercrest Senior Living. “We are dedicated to supporting the growth of San Jose and the surrounding areas through job creation, educational enrichment and common unity relationships.”

Watercrest principals, Marc Vorkapich, CEO and Joan Williams, CFO, with project co-owners Starling Senior Living, recognized the demand for a resort-like community in Jacksonville offering upscale accommodations and amenities tailored to today’s senior. Watercrest of San Jose features an idyllic setting with Florida style outdoor living spaces and tranquil views of Goodby’s Creek. The pleasant, small town atmosphere offers close proximity to Jacksonville’s premier shopping, restaurants, cultural attractions and sporting events.

Watercrest Senior Living is committed to enriching the lives of seniors by creating an environment of well being through wellness programs, nutritious and savory dining, and personalized care. All Watercrest memory care associates are Certified Dementia Specialists and their comprehensive memory care program utilizes innovative lifestyle approaches including personal life silhouettes, multi-sensory enhancements, Memories in the Making, and Music and Memory programs.

ORLANDO, FL – Carroll Organization, one of the country’s leading privately-held real estate companies focused on multifamily investment, management and development announced that it has acquired ARIUM Bala Sands, a 298-unit multifamily community in Orlando, FL, as part of its newest investment vehicle, Carroll Multifamily Real Estate Fund IV, LP.

“We purchased this deal from an existing partnership. Having already been managing the deal for nearly 3 years, we have a thorough understanding of the property, its location, value-add strategy, and business plan,” said M. Patrick Carroll, Founder and Chief Executive Officer of Carroll Organization. “We were able to buy at an attractive cap rate and utilize accretive debt to produce great cash flow from day 1.”

ARIUM Bala Sands is a lake-front, garden style apartment community built in 2002 across 36 acres. All units feature attached garages, 9 ft ceilings, full size washers and dryers, walk in closets, crown molding, and built in book shelves. With its average unit size of 1,097 square feet, Bala Sands features some of the largest floor plans in the submarket. The property is located within the prestigious Windermere School District including three schools which are A-rated by the Florida Department of Education. Bala Sands is also conveniently located only minutes from downtown Orlando, Disney and Universal Studios.

Orlando boasts one of the strongest multifamily markets in the country. The market is among the nation’s leader in job growth and population growth. It was the #1 market for job creation in the country in 2015 and was also ranked 5th nationally in rent growth.

To date, Carroll has successfully exited nineteen assets valued over $645 million, including this transaction. The investments have produced an average IRR of 30%. Carroll has purchased twenty-eight properties totaling over $1.2 billion since the beginning of 2015 and is continuing to actively purchase high-quality multifamily communities in the Southeast and Southwest, and other strategic target markets across the country. Carroll sourced many of its deals “off-market” directly from developers and owners, and is recognized in the industry as a best in class renovator and operator.

(RECAP: A starter home is “smaller, it’s cheaper and in an area that might not be in an area where you eventually want to settle down,” says Dr. Issi Romem, chief economist for BuildZoom, a real estate construction marketplace. But these days, first-time buyers aren’t choosing starter homes. Rather than buying a starter home and planning to upgrade in five years or so, first-time homeowners are buying and staying put, according to research conducted by the National Association of Realtors. “When they do purchase, they’re planning on living there longer than buyers that we’ve seen in the past,” says Jessica Lautz, NAR’s managing director of survey research. “They’re expecting to live there 10 years.” That trend is borne out in another survey, fielded by Bank of America in early 2016. The research found that 75% of first-time buyers would prefer to skip the starter home stage and find a house that meets their present and future needs. And more than one-third of those surveyed (35%) said they intended to be “one and done” — actually planning to retire in their first home.)