Author: ipgocorp

LOS ANGELES, CA – Decron Properties acquired Adagio at South Coast, a 349-unit multifamily apartment community in Santa Ana, CA for $96 million. The property was sold by Prime Residential.

Over the last 12 months, Decron has acquired 1,190 units in transactions totaling approximately $334 million. Based in Los Angeles, Decron is a California-focused real estate investment and development firm that strategically acquires worn out apartment communities in thriving suburban markets, with close proximity to job centers, and then renovates them – inside and out – to meet the quality and standards of today’s renter. Recently, Decron successfully executed this business strategy in Ventura, Los Angeles, and San Diego counties. 

“We’ve invested in Orange County before, and we’ve always loved the area,” said David J. Nagel, President and CEO. “We’re taking our tried and tested strategy of ‘affordable luxury,’ which is all about giving our renters high quality apartment and lifestyle amenities at a price point they can afford, and replicating it for renters in Orange County.”

Adagio at South Coast is a garden style multifamily community built in 1974. Over the next few years, Decron plans to renovate unit interiors with shaker style cabinets, quartz countertops, stainless steel appliances, vinyl plank flooring, and in-unit washers and dryers. Common Area upgrades will include a fully renovated fitness center and clubhouse, fire pits, outdoor lounge areas, resort style pool amenities, new BBQ areas, playground furnishings, dog parks, and added parking through the use of parking lifts.

“This community, built in the 1970s, is well-located, literally steps from MacArthur Boulevard, home to numerous companies and tens of thousands of jobs, and South Coast Plaza, California’s largest retail and lifestyle destination,” Nagel said. “The community is ripe for a full repositioning, and after our improvement work is complete, we will compete very well against newer product and at a much lower price point than other communities in the submarket.”

Decron is no stranger to Orange County, with prior investments in Mission Viejo and La Habra and a nearby investment in Huntington Beach, where it owns a 300,000-square-foot mixed use retail and office project that is also being redeveloped into a higher and better use, now being rebranded as “Ocean Plaza.” 

With the completion of this acquisition, Decron owns and manages 6,700 multifamily units across California, as well as 1.5 million square feet of commercial office and retail, in 55 communities.

DALLAS, TX – Oates Creek and Parkside are 2 of the 8 properties NAPA is acquiring as part of a 1450 unit multifamily portfolio acquisition in Dallas – Fort Worth metro area. Dallas – Fort Worth MSA is ranked #3 in job growth in U.S. cities in 2015 according to Dallas Business Journal. NAPA will complete the acquisition of this entire portfolio by September of 2016.

Oates Creek Apartments is a 280-unit apartment community with one and two bedroom floorplans, located in Mesquite, Texas in north Dallas and minutes away from the Dallas Athletic Club, Audubon Park, and Mesquite Golf Club. Oates Creek is also located minutes away from Montecito Creek, a 650 unit apartment complex owned by NAPA. Oates Creek investment is a joint venture between NAPA and one of its existing & repeat equity partner, a family office with over $3 Billion worth of commercial real estate under its ownership.

Parkside Townhomes is a 144-unit apartment community with spacious two and three bedroom floor plans, located in Arlington, Texas and minutes away from Six Flags Over Texas, Dallas Cowboys and Texas Rangers stadiums. Parkside investment is a joint venture between NAPA & one of the nation’s top crowd funding platforms. Equity capital was raised within days of publishing the content on their investments portal.

NAPA has plans to upgrade and renovate the exterior and interior of both of these properties to increase rents to market comparables and in return provide a great living experience to the residents in a booming Dallas – Fort Worth multifamily market. These updates include complete makeover of landscaping, pool decks, parking lots, exterior paint and a transformation of the leasing office by reconfiguring the interior layout & upgrading the business center. Interior unit renovations include upgrades to countertops, cabinets, paint and floors, and trendsetting black appliances.

CHARLOTTE, NC – Ginkgo Residential announced the acquisition, through its investment affiliate, of Croasdaile and Croasdaile Crossings Apartments located in Durham, North Carolina.

The approximately 20.86-acre property is comprised of 272 one, two, and three-bedroom, garden style apartments, and features two swimming pools, two fitness centers, club room with free Wi-Fi, children’s playground and scenic views of the adjacent Croasdaile Country Club golf course.

Croasdaile is located in the heart of the North Durham retail corridor, including Northgate Mall, and is only 2.2 miles from the center of Duke University’s campus and 3 miles to the Duke Regional Hospital and Duke University Hospital.

“Ginkgo Residential is excited to continue our focus on providing high quality workforce housing with the addition of Croasdaile Apartments. Easy access to I-85 and close proximity to retail, Duke University and its Hospital system make Croasdaile an opportune place to live in the Durham market. The property also provides views of Croasdaile Country Club, the 71st highest ranked course in North Carolina. We are fortunate to add Croasdaile to our portfolio,” states Philip Payne, CEO of Ginkgo Residential.

Ginkgo Residential is an industry leader focused on combining their core business of providing reasonably priced, high quality workforce housing with energy efficient programs that are environmentally sensitive. Ginkgo Residential is a significant operator of apartment communities located primarily in the Southeast region of the United States.

(RECAP: After nearly two years of tweaking plans for redevelopment, The Bozzuto Group may be ready to move forward with plans to nearly double the size of St. Johns Wood Apartments near North Point Village Center. After several postponements in 2015, and two postponements in June and July of this year, the proposal has a new Fairfax County Planning Commission hearing date of Sept. 29. The latest plan is to redevelop the 250-unit garden apartment complex into 511 multi-family units and 51 townhomes. That’s actually a scaled-down and lower-rise version from the first plans that were shown to community members more than a year ago. Twelve percent of the units will be set aside for affordable housing. No word yet on what would happen to current residents during redevelopment.)

CHICAGO, IL – With an excess of institutional and public capital at the start of 2016, the senior housing market began the year with a slight pause but has now steadied and is poised for long-term growth. Driving the senior housing market is need-based housing, which includes skilled nursing facilities, assisted living, and memory care.

The number of U.S. citizens age 65 and older continues to grow at a record pace. According to the U.S. Bureau of the Census, this group numbered 46.2 million in 2014 — the last year for which data is available. They represent 14.5 percent of the U.S. population and are estimated to rise to 98 million by 2060, more than double compared to 2014.

“Given the vast number of seniors in the pipeline, it will be very difficult for senior housing to be overbuilt in the long run,” says Paul Aase, CCIM, partner at Active Senior Concepts in Johns Creek, Ga. “The challenge is that the bulk of the resident growth will not be hot for another 10 to 15 years as the baby boomers start to age.”

Most supply is in need-based facilities. While there is also development momentum in independent living facilities, neither markets show an oversupply.

“Skilled nursing in most states requires a certificate of need, which creates a barrier of entry, so that area has not been overbuilt,” says Richard Lynn, associate of the National Seniors Housing Group at Marcus & Millichap in Oakbrook Terrace, Ill. “Independent living also hasn’t been overbuilt because it is want-based and not need-based. The supply could exceed demand for some period of time, but ultimately the demand will catch up.”

The senior housing vacancy rates were 8 percent for Q1 in 2016 and 8.3 percent for Q4 in 2015, according to Reis. Cap rate compression has also been seen across the board in senior housing during the last few years.

“On the institutional side, REITs are very dependent on interest rates. So with the expectation of those going up, it does take money out of the public sector,” Lynn says. “But below that, there are other sources like private equity, institutional, and the lending environment, which tends to bring balance. There is plenty of liquidity in the industry.”

With long-term fundamentals looking strong and demographics moving in the right direction, a significant demand for need-based senior housing will occur. Because of increased regulations and certifications, the trend of senior housing becoming more upscale and focused on health and wellness brings additional challenges to need-based facilities.

“There is a much higher operational risk in need-based senior housing assets, such as skilled nursing facilities, higher-acuity assisted living, and memory and Alzheimer-related facilities,” says Robert Stone, CCIM, president for R2S Interests, Senior Housing Brokerage & Consulting Services, in Richardson, Texas. “Close attention should be paid to underwriting during acquisitions of need-based properties because the operations are usually more important than the bricks and sticks.”

Roughly 70 percent of U.S. adults over the age of 65 will need long-term care at some point in their lives, according to U.S. Department of Health and Human Services. As baby boomers start to shift from being the caregivers to being the receivers of care, they are expected to demand more amenities from senior housing facilities. Demand for senior housing will continue to be steady with many new well-structured and capitalized projects coming to market.

CAMBRIDGE, MD –  The NHP Foundation (NHPF), a national not-for-profit organization dedicated to preserving and creating sustainable, service-enriched multifamily housing, announced that is has acquired the Calvin Mowbray Park & Stephen Camper Park Apartments, a multifamily property located at 700 Weaver Avenue in Cambridge, MD. 

The acquisition was made possible through a joint venture of NHPF, CHA IDS LLC and The Housing Authority of Cambridge, MD (HAC), and through financial partnerships with the U.S. Department of Housing and Urban Development (HUD), Wells Fargo, the Maryland Community Development Administration and Department of Housing and Community Development and R4 Capital LLC. The property was acquired through a 98-year Capital Lease for $11 million.

Originally constructed in 1972/1973, the property is 183,540 square feet, 88 buildings featuring 190 units that range from one to five bedrooms. With the properties in need of massive renovations, NHPF and its partners have already begun a two-year process of restoration and improvement including the installation of kitchen and bathroom upgrades, new energy efficient lighting and HVAC, washers and dryers, as well as the repair of private driveways, sidewalks and more.

“For over four decades, the Calvin Mowbray Park & Stephen Camper Park apartments have been a massive asset to residents seeking housing that is affordable in the Cambridge area,” said NHPF’s President and CEO Richard Burns. “Through this acquisition and the subsequent renovations to the complexes, we will return the property to its former glory and strive to provide top quality services and an overall heightened quality of life to residents that is rarely found in affordable housing today.”

“This exciting joint venture with NHPF and CHA IDS LLC is exactly the type of partnership crucial to ensure that low and moderate income families are afforded the opportunity to continue to live in a safe environment and decent affordable housing,” said Carlton W. Stanley, Chairman of the Board of Commissioners for HAC, and Genevra Farrare-Arrington, Executive Director for HAC, “And HAC is pleased to be at the forefront of the project.”

In addition, the Calvin Mowbray Park & Stephen Camper Park apartment purchase is NHPF’s first acquisition using HUD’s Rental Assistance Demonstration (“RAD”) Program. Under the RAD program, the properties will receive a Section 8 HAP contract for all 190 units, which will facilitate easier access to needed assets — such as funding — from the private sector to make improvements to the property.

“Private-public partnerships will be essential to providing high-quality affordable housing for low and moderate income individuals, families and seniors moving forward,” said Burns. “By participating in a RAD project, we are providing evidence that the public and private sectors can work together in affordable housing, and that they can also do so incredibly effectively. We are looking forward to the Calvin Mowbray Park & Stephen Camper Park partnership.”

(RECAP: Rents are soaring and demand for apartments is historically high, but some developers and landlords are overestimating the strength of the U.S. apartment market — and paying for it in quarterly earnings. Others are warning that the second half of this year will be even tougher. Construction of new multifamily units has been robust over the past five years, far outpacing that of single-family homes, but most of the product is in pricey markets and pricier neighborhoods, not in areas where demand is highest. That is because the costs of land and construction rose.)

SEATTLE, WA – Median rent for the least expensive multifamily rental homes is rising faster than median rent overall, and only a small portion of all new apartments is at the low end, according to the latest Zillow analysis.

Instead, most new apartment construction is at the top of the market, where luxury units command top prices from wealthy renters.

Zillow analyzed median rents in 15 major housing markets across the country and found that median rent for the least expensive third of apartments was outpacing the overall rental market.

The trend is especially prevalent in California. In Sacramento, for example, the price of the least expensive rental homes rose 33 percent over the last year, while overall median rent rose just 7 percent.

Cheaper apartments were more in line with overall rent appreciation in Denver and Seattle. The least expensive rentals rose 9 percent in Denver over the past year, while the rental market as a whole rose 7 percent. In Seattle, the least expensive rental homes rose 14 percent and the entire rental market rose 9 percent.

“There’s a growing divide in the rental market right now,” said Zillow Chief Economist Dr. Svenja Gudell. “Very high demand at the low end of the market is being met with more supply at the high end, an imbalance that will only contribute to growing affordability concerns for all renters. We’re simply not building enough at the bottom and middle of the rental market to keep up with demand. As a result, these segments are becoming very competitive, as both new renters look to find their first place and existing renters get shut out of homeownership because of extremely limited for-sale inventory. Apartment construction at the low end needs to start ramping up, and soon, in order to see real improvement.”

In Tampa, Fla., 93 percent of apartments built after 2014 were among the most expensive. In Miami, 69 percent of listed new construction was among the most expensive and just 11 percent was among the least expensive.

Charlotte, Denver and Seattle had the smallest percentage of low-end construction built after 2014 — just 4 percent of new construction in Charlotte was among the least expensive third of rental homes and only 7 percent in Denver and Seattle.

SCOTTSDALE, AZ – Trinsic Residential Group has selected Greystar to manage The Standard Apartments in Scottsdale, Arizona. The 134-unit boutique community is located at 6811 East Main Street adjacent to the iconic Hotel Valley Ho. The Standard is Scottsdale’s only luxury apartment community to partner with Hotel Valley Ho to offer one-of-a-kind resident amenities that include limited access to the OH pool, VH Spa and room service.

“We are delighted to work with Greystar and partner with Hotel Valley Ho to provide our residents with an exceptional living experience,” said Todd Gosselink, Managing Director of Arizona for Trinsic Residential Group. “We designed the community with a mix of contemporary and mid-century modern elements, bright accents and distinct artwork that together create an upbeat environment.”

Community amenities include a clubhouse with social spaces, an entertainment kitchen, a full-service coffee bar and a resident lounge. A club-inspired fitness center includes weight machines and the latest cardiovascular equipment with floor-to-ceiling windows. Residents can enjoy the resort-style swimming pool, spa, rooftop sundeck with lounge areas, cabanas, misting systems, grilling stations and an outdoor kitchen. The pet-friendly community also offers a pet spa, bicycle rental and repair station, electric car charging stations and a controlled access parking garage.

The well-appointed community offers one-, two- and three-bedroom apartment homes and penthouses ranging in size from 650 to 1,750 square feet of living space. Designer interior finishes include quartz countertops, stainless steel appliances and wood flooring. Floor plans include contemporary kitchens with breakfast bars, tile back splashes, spacious walk-in closets, full size Energy Star washers and dryers, as well as private patios or balconies with skyline views of downtown Scottsdale and Camelback Mountain.

“The new urban community offers residents an ideal location with great walkability right in the heart of Old Town Scottsdale,” said John Rials, Senior Managing Director of Real Estate for Greystar. “The Standard is steps away from local restaurants, shopping destinations, entertainment venues and nearby recreation.”

LOS ANGELES, CA – MWest Holdings continues to expand its Heritage Collection with the acquisition of the stunning Park Wilshire Apartments.  Designated as a Historic-Cultural Monument by the L.A. Cultural Heritage Commission, the Park Wilshire was designed by the famed architectural team of Clarence H. Russell and Norman W. Alpaugh.  

Located at 2424 Wilshire Boulevard, between Koreatown and downtown Los Angeles, the eight-story building is a beautiful example of the Italian Renaissance Revival style.  Clad in polychrome red brick, the Park Wilshire originally opened in 1924 as a residential hotel.  Today, the building features spacious studio, one bedroom, and two bedroom apartments, many of which boast expansive city views.  

MWest Holdings will restore the original vitality and grandeur to the Park Wilshire, just as it has done in the renovation of its previous acquistions of historic buildings.   Prioritized in the renovation will be the restoration of the building’s signature rooftop sign that had been an iconic fixture on Wilshire Blvd since the 1920s.  

“The Park Wilshire neon sign is not just a glowing placard, but also an atmospheric symbol that returns the building, as well as the surrounding neighborhood, to it roots in Los Angeles’ classic film noir period,” states MWest President, Karl Slovin.  MWest will also substantially upgrade the building with a refurbished lobby, new corridors, reconstructed and redesigned unit interiors, fresh landscaping, and a brand new, fully-equipped, state-of-the-art fitness center and business center – all while maintaining the unique character and historic charm of the property.  “With the imminent completion of our renovations to the Wilshire Royale, located across the street, we look forward to turning our creative energy to the Park Wilshire.  We want to bring it back to life,” says Slovin.

Location also favors the Park Wilshire Apartments.  There are numerous restaurants, schools, and shopping locations within walking distance, and Downtown and USC are only a short commute away. Additionally, CoStar projects that redevelopment in the Downtown, Koreatown, and Westlake submarkets will total eight billion dollars.

“With the explosion of new construction in both Downtown and Koreatown, we believe Westlake offers our tenants the ideal proximity to jobs, shopping and nightlife but with much greater character, charm and history than those other neighborhoods,” says Slovin.  “The historic Westlake district offers amazing opportunity.”