Following a period of tepid investment appetite in the region, the southern U.S. is witnessing a significant increase in transaction volume over the past two years, according to Yardi Matrix data. Transactions increased by almost 16 percent during 2016 from the previous year to a record $4 billion. The sales total for multifamily assets traded in 2017 was almost on par with 2016’s cycle high.
Since the beginning of this year, more than 40 communities have traded in the region through April, for a combined $648.9 million. Investors focused mostly on properties in Tennessee, where more than 35 percent of the total transaction volume was concentrated. Kentucky followed with roughly 21 percent of the transaction volume in the region. Unsurprisingly, properties completed during this decade had the highest per-square-foot prices. West 46th, a property delivered last year, commanded $260 per square foot, followed by the 2015-built Sterling Burbank, with $239 per square foot.
10. Shillito Park
In February, Zinger Property Group acquired Shillito Park, at 3500 Beaver Place Road in Lexington, Ky., from Zaragon. The 216-unit community, which was roughly 93 percent occupied at the time of sale, changed hands for $19.2 million. The transaction was subject to a $39 million acquisition and development loan provided by Benefit Street Partners. The nine-building multifamily asset was completed in 1990 and consists of one- and two-bedroom units ranging in size from 800 to 1,125 square feet. Community amenities include a fitness center, swimming pool, playground and more than 350 parking spaces.
9. Villages at Fort Town
At the beginning of the year, an individual investor paid $20 million for the 294-unit Villages at Fort Town. Situated at 304 Fort Town Drive in Fort Oglethorpe, Ga., the 58-building community offers one- and two-bedroom apartments with an average size of 773 square feet. Completed in phases in 2002, 2003, 2006, 2013 and 2016, Villages at Fort Town features a playground, swimming pool and 670 parking spaces. The property is located near Sentry Station and Battlefield Centre shopping centers, as well as multiple schools, including Battlefield Primary School and Lakeview-Fort Oglethorpe High.
8. The Villas at Oak Crest
Timberland Partners purchased The Villas at Oak Crest in Chattanooga, Tenn., for $21.3 million from Hyde Capital Group earlier this year. That’s just slightly more than $100 per square foot. The sale was subject to a $15.4 million Fannie Mae loan from Berkadia Commercial Mortgage. The 11-building multifamily asset consists of one-, two- and three-bedroom units ranging from 738 to 1,516 square feet. Built in two phases in 1986 and 1999, the property includes a fitness center, community room, tennis court, two swimming pools and about 370 parking spaces. Located at 7255 Lee Highway, the property offers convenient access to various public transportation and shopping options, as well as to Interstate 75. Last month, Timberland Partners also acquired Huntington at Sundance, a 292-unit Tampa-area multifamily asset.
7. City Side Flats
After acquiring the 235-apartment Newport last September, Emma Capital snagged another Nashville community this year. The Toronto-based company paid $24.6 million to Lighthouse Group for the 201-unit City Side Flats, located at 1441 Lebanon Road. The unit mix consists of studios, one-, two- and three-bedroom apartments ranging from 520 to 1,285 square feet. Community amenities include a clubhouse, swimming pool, fitness center, more than 400 parking spaces and multiple laundry facilities. The 18-building City Side Flats sits near the intersection of interstates 24 and 40 and about three miles from Interstate 440. Last August, Emma Capital also purchased two communities in Charlotte, N.C., totaling 550 apartments.
6. Lexington Park
In February, Entrepreneurial Corporate Group purchased Lexington Park from Burkhalter & Stevens. The 288-unit community in North Little Rock, Ark., changed hands for a little more than $24.8 million. Delivered in 2007, the 12-building multifamily asset consists of one-, two- and three-bedroom apartments averaging 982 square feet. The Class B property features a spa, swimming pool, clubhouse, roughly 500 parking spaces and a fitness center. Lexington Park is situated near the intersection of interstates 40 and 430 and less than 10 miles from various schools, including The Anthony School, North Little Rock High School and Hall High School.
5. West 46th
This January, Venterra Realty bought the recently completed West 46th in Nashville from Stonehenge in a $34 million deal subject to a $22.1 million Fannie Mae loan from PNC Bank. The asset offers studios, one- and two-bedroom apartments ranging between 511 and 1,090 square feet. Community amenities include a business center, fitness center, covered parking and 200 parking spaces. Located at 4510 Charlotte Ave., the multifamily property sits next to Interstate 40, multiple public transportation, shopping and entertainment options, including Darkhorse Theatre and Nashville Cash & Carry.
4. Riverchase Landing
Coming in at No. 4 is Balfour Beatty’s acquisition of Riverchase Landing in Hoover, Ala. The London-based company paid $39.2 million to TVO Groupe for the 468-unit community. The sale was funded by a $29.9 million Freddie Mac loan from Berkadia Commercial Mortgage. Located at 200 River Haven Circle, the 26-building multifamily property features one-, two- and three-bedroom apartments ranging from 1,070 to 1,900 square feet. Common-area amenities include a fitness center, clubhouse, tennis court, playground and three swimming pools. The asset, completed in phases in 1984 and 1991, is situated less than four miles from Interstate 65.
3. Mallgate of St. Matthews
In January, Sundance Bay purchased the 540-unit Mallgate of St. Matthews in Louisville, Ky. in a $42.5 million deal with Shamrock Communities. The sale was subject to a $40.3 million loan from Grandbridge Real Estate Capital. Completed in 1969, the 23-building community is located at 514 Brightwood Place, near the intersection of interstates 64 and 264, as well as multiple shopping centers, including Mall St. Matthews and Oxmoor Center. The new owner selected Barrett & Stokely to manage the multifamily asset, which offers studios, one-, two- and three-bedroom apartments averaging 989 square feet in size. Community amenities include a business center, fitness center, basketball court and more than 1,000 parking spaces.
2. The Racquet Club
Covenant Capital Group sold the 474-unit The Racquet Club in Lexington to Strata Equity in January. The 25-building community changed hands for $51.5 million. The sale was part of an $85 million portfolio transaction that also included the 183-unit Veridian Apartments in Spartanburg, S.C., and the 180-unit Icon on the Greenway Apartments in Gastonia, N.C. The Racquet Club consists of one- and two-bedroom apartments ranging from 500 to 1,047 squarer feet. Common-area amenities feature a fitness center, clubhouse, tennis court, volleyball court, swimming pool and spa. Additionally, the multifamily asset also offers more than 700 parking spaces, as well as convenient access to Tates Creek Centre and Walmart Neighborhood Market.
1. Sterling Burbank
Topping our list is Scion Group’s acquisition of the 235-unit student housing Sterling Burbank in Baton Rouge, La. Dinerstein Cos. sold the asset for $62 million or $239 per square foot. Designed to meet LEED Gold standards, the asset was completed in 2015 and offers one-, two-, four- and five-bedroom units. Located at 4194 Burbank Drive, the five-story building sits roughly one mile away from Louisiana State University and two-and-a-half miles from Interstate 10. Community amenities include a volleyball court, fitness center, clubhouse, two swimming pools and a spa.
Images courtesy of Yardi Matrix