December 2012

  • Dec
    28

Ram Cinches Three Deals— Adds 1,000 Multifamily Units In December

December 28, 2012

Ram has announced that during the month of December 2012, it has concluded the acquisition of three multifamily properties in the southeast, adding in excess of 1,000 units to its roster of communities under ownership and management:  Stonehenge Apartments in Raleigh, NC; The Resort at Lake Fredrica in Orlando, FL; and Piper Station at Piper Glen in Charlotte, NC.

“The common theme amongst these acquisitions,” said Casey Cummings, Ram’s CEO, “is that Ram is seeking a greater return than the traditional existing asset cash flow.  Each of these assets provides real value-add opportunities, either through the development of excess land and/or through the incremental returns from investing in the rehabilitation of the property.”

Ram intends to upgrade, rebrand and provide marketing support to enhance performance in better-maintained communities, such as Stonehenge, or undertake extensive rehabilitation in properties that have not been kept current, like the Resort at Lake Fredrica. “We expect the apartment business to continue to be a major part of our business in this cycle,” Cummings added.

Stonehenge Apartments was built in four phases between 1984-1993 and offers 452 units with 11 floor plans.  The multifamily community is located in a mature master planned development ten miles north of Raleigh and already maintains a very high occupancy.

Piper Station Apartments at Piper Glen is a 212-unit garden-style apartment community located in the Ballantyne submarket of Charlotte.  The property was built in 1996, has been well maintained, but has not undergone significant renovation.

The Resort at Lake Fredrica is a 360-unit garden-style apartment community, situated on a 37.5-acre site on South Semoran Avenue in southeast Orlando.  The property was built in 1973 and renovated in 1997 and 2006.  The property’s unique location on a spring-fed lake, with close proximity to Orlando International Airport, balances convenience with a waterfront location.  The property enjoys consistent occupancy rates above 90%.

 

 

  • Dec
    10

Real Deals: Triangle apartment sales top $1 billion in 2012

December 10, 2012

By David Bracken, via newsobserver.com

If you’re wondering why the Triangle seems to have so many new apartments being built and proposed, here’s your answer:

With three and a half weeks to go, the apartment market is on pace to set a record for the total dollar amount of transactions completed in a single year.

So far this year, 41 apartment buildings have sold for a combined $1.039 billion, which is the second-highest annual total ever recorded, according to real estate firm CBRE. The record, $1.063 billion, was set in 2006 during the height of the real estate boom.

The eye-popping sales total is just the latest indication of how attractive the region’s apartment market has become to investors of all stripes. Two sales last week put the market over the billion-dollar mark: the sale of the Apartments of Stonehenge in North Raleigh for $40.2 million, and the sale of the Panther Creek apartments in Cary for $33.5 million.

The Stonehenge deal in particular was a reminder of how quickly multifamily assets can appreciate in today’s market.

Stonehenge was acquired by Ram Realty Services, the company that is also developing the 140 West Franklin condo project in Chapel Hill. Ram bought the 452-unit complex from Robinson Development Group of Norfolk, Va., which paid $35 million for it a little over two years ago.

The apartment market will eventually cool off. The question is when and how quickly.

Investors have been scooping up apartments in the Triangle both because of this region’s relative economic health compared to other areas and its solid prospects for the future. The Triangle’s many universities churn out a steady supply of renters, and the region’s diverse economy produces the kind of high-paying jobs that help fill up luxury complexes.

The Triangle’s apartment vacancy rate stood at 5.5 percent in September, down from 6 percent in September 2011, according to data from Karnes Research and the Triangle Apartment Association. Rents increased by 4 percent over that period – a rate of growth that investors would be hard-pressed to find elsewhere.

At 5.5 percent, the Triangle’s vacancy rate is the lowest it has been since September 2000, according to Karnes and the TAA.

But the strong performance over the past two years has been fueled by a culmination of several factors that are unlikely to be in place much longer. The downturn in the single-family housing market has forced many would-be homeowners to become renters, and the tightening of lending standards has prevented others from qualifying for a mortgage.

The region’s housing market is now showing signs of recovery, posting double-digit sales gains in each of the first three quarters of this year. If the recovery continues, it will attract renters who have spent the past few years repairing their finances, particularly if apartment owners continue to push rents higher.

The other factor is supply. The credit crunch caused construction of all kinds of commercial real estate to halt. The lull in new apartment construction helped drive up occupancy levels in places like the Triangle, which continued to add residents even during the recession.

Now developers are racing to build new complexes. There are 6,106 apartment units under construction, and another 11,869 proposed. If all those were built the Triangle’s inventory would expand by 18 percent.

Of course, not all the proposed units will get built, but the completion of new projects over the next 18 months is sure to put downward pressure on rents. That will particularly be the case in areas such as Brier Creek and near downtown Raleigh where several new projects are scheduled to open around the same time.

Still, with way the economic recovery has been playing out in other commercial real estate sectors, apartments are likely to remain a shining star for a while longer.

Read more here: http://www.newsobserver.com/2012/12/05/2527053/triangle-apartment-sales-top-1.html#storylink=cpy