As it aims to expand, Chicago-based apartment owner Draper and Kramer has already established a foothold in Texas with three properties in the Dallas-Fort Worth area. However, it is looking for larger penetration into the Lone Star State’s ultra-competitive multifamily market.
With the late-August purchase of the Griffis at Riata, a 307-unit multifamily property in Austin, it achieved its goal of moving into another popular Texas metro.
“Austin has always been on our target list in terms of expansion just for its long-term growth opportunities and a lot of really positive employment and net migration trends,” Blas Puzon, Draper and Kramer’s chief investment officer, told Multifamily Dive. “We just saw an opportunity with 1031 [exchange] sale proceeds to take advantage of a low-interest-rate loan assumption.”
Griffis at Riata, completed in 2017, has 195 one-bedroom units and 112 two-bedroom units across 17 buildings, including five three-floor apartment buildings and 12 two-story rental townhomes. Draper and Kramer, which owns 20 properties across six markets, will rebrand the property as DK Riata.
“We are purchasing it at a pretty big discount to replacement costs,” Puzon said. “That was ideal for us.”
Apartments at Griffis at Riata feature plank-style flooring, island kitchens with granite countertops and stainless-steel appliances, 9-foot ceilings, in-unit washers and dryers, smart thermostats and spacious walk-in closets. The property’s amenities include co-working spaces, a resident lounge, two large fitness centers, a pet spa and a dog park. Other outdoor amenities include a resort-style pool with loungers and cabanas, a two-grill outdoor kitchen and a large fire pit area.
“The previous owner took good care of it,” Puzon said. “There is really no plan that we have at this time to renovate interiors or anything like that.”
Location was a big attraction to Draper and Kramer. The LEED-Silver property sits adjacent to Apple’s expanding Austin corporate campus and provides access to downtown Austin, Riata Corporate Park, the Arboretum outdoor shopping center, Lakeline Mall, The Domain Shopping Center, St. Edwards Park and Lake Travis. At the time of purchase, Griffis at Riata was 95% leased and its average rents are at $1,650 per month.
“The Riata neighborhood is full of corporate employers,” Puzon said. “It is a short distance to downtown. So it's really ideally located for a high-income-earning demographic.”
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