Minnesota Owner Buys Florida Apartments
By Dees Stribling, Contributing Editor
Kissimmee, Fla.—Dominium, a multifamily landlord based in Minneapolis, has acquired St. Cloud Village Apartments in Kissimmee, a suburb of Orlando, for an unspecified price. The property includes 208 units of affordable housing.
According to the new owner, it will also spend about $3.3 million, or about $16,000 per unit, for renovations to the property. The upgrades will include replacement of HVAC equipment, new countertops, cabinets, flooring and lighting as needed in individual units. Dominium will also be investing in a new playground, a refurbished entry drive, and a new bus shelter on the site.
Dominium co-managing partner Armand Brachman notes that there’s a shortage of affordable housing in central Florida, where demand for all kinds of multifamily rental properties is high. Investment specialist Macus & Millichap predicts that the vacancy rate for greater Orlando apartments will drop 20 basis points to 5.2 percent by the end of this year, following an 80-basis point plunge in 2012 and a drop of 170 basis points in 2011.
Developers are adding apartments to the market, but not quite fast enough to meet demand. Rental inventory will expand 2 percent in 2013 with the completion of about 3,000 new units, according to Marcus & Millichap. In 2012, 1,224 new apartments came on line.
Currently Dominium owns or manages over 23,000 units in 19 states. The company specializes in developments under various governmental programs, such as Section 8, FMHA 515, public housing, state agency funded properties and Section 42-Low Income Housing Tax Credit (LIHTC) properties.