Carroll Org. Sells Memphis Community

2 min read

The company bought the 1,037-unit ARIUM Shelby Farms in July 2014 as a part of Carroll Multifamily Real Estate Fund III LP.

By Jeffrey Steele

Arium Shelby Farms1Atlanta-based Carroll Org. has sold ARIUM Shelby Farms in Memphis, Tenn. The company bought the community in July 2014, as a part of Carroll Multifamily Real Estate Fund III LP.

The 1,037-unit community sits on a 105-acre property that features mature trees, stocked lakes and walking paths. The apartment homes include private patios, breakfast bars, open living space and full-size washer-dryers. Residents benefit from convenient access to I-40 and I-240, as well as proximity to fine dining and shopping.

ARIUM Shelby Farms is only minutes away from Wolfchase Galleria, IKEA, Overton Square and Midtown, and is situated in Memphis’s most prestigious school district.  

Profits for investors

The property had sustained a strong performance trend, and several comparable properties in the area had traded recently supporting our underwritten exit valuation. So we decided to sell and realize profits for our investors,” Carroll Org. vice president of investments Andrew Zelman told MHN. “The size of the property, 1037 units, in a secondary market, Memphis, made it challenging to find the right buyer for this asset. However, ARA Newmark did an excellent job of engaging several qualified buyers across the country and created a competitive process which ultimately resulted in achieving our strike price.

ARIUM Shelby Farms proved an attractive opportunity because the property’s size delivered immediate scale in the Memphis market, added M. Patrick Carroll, company CEO. “It also fit well with our strategy of acquiring well-located workforce housing in the Southeast,” he noted. “The investments and operations teams did an exceptional job of executing our business plan and achieved solid organic rent growth during our ownership. However, after a 3.5-year hold period, we made the decision to sell and post a win for our Fund III investors.

Including this transaction, Carroll Org. has successfully exited 41 assets with a collective value of more than $1.9 billion. The investments have produced at average IRR of 30 percent. Since the start of last year, the company has sold a dozen properties totaling more than $825 million and purchased 40 properties totaling more than $1.6 billion. Carroll Org. sourced many of its deals off-market directly from developers and owners.

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