When New York City-based investment manager Blackstone announced its purchase of Denver-based Apartment Income REIT Communities in April, apartment industry leaders hoped it might be a sign that the sales market was finally starting to thaw.
Early indications are that the Blackstone sale, along with New York City-based global investment firm KKR’s recent purchase of 5,200 units from Irving, Texas-based developer Quarterra Multifamily and acquisition of Blackstone’s student housing portfolio, are giving investors some comfort in coming off the sidelines.
“We are seeing buyer investor sentiment improving significantly since the announcements of several large portfolios,” Jamie May, chairman and CEO of Naples, Florida-based brokerage firm JBM Institutional Multifamily Advisors, told Multifamily Dive.
But those high-profile deals aren’t the only things opening up the sales market in Florida. “Insurance pricing has also started to come down, as well as Fed Chairman [Jerome] Powell’s expectation for initial interest rate cuts in September,” May said.
In a sign that things are picking up, Boca Raton-based Interface Properties recently purchased Brantley Pines, a 296-unit property in Fort Myers, Florida, from Oak Brook, Illinois-based commercial real estate owner The Inland Real Estate Group of Companies for $57 million, or $192,568 a unit.
May said more than 20 offers were made for the property, which is within file miles of Publix Super Market, Target, Whole Foods, Lee Health Gulf Coast Medical Center and Lee Memorial Hospital.
Although some firms that bring properties to market may be under pressure, May said that wasn’t the case with Inland. “Inland is a large DST [Delaware Statutory Trust] firm,” he said. “They typically hold three to five years, so this was within their typical disposition criteria.”
Renovation opportunity
Inland had upgraded 46% of the property before selling, leaving Interface some value to squeeze out of the asset. The buyer plans to complete the renovation program while also adding a lakeside walking path and enhancing the clubhouse, pool area and landscaping.
Brantley Pines, a low-density property with 10.17 units per acre and one-, two- and three-bedroom units, was built in two phases in 1988 and 1997. Its amenities include a resort-style pool, lakeside deck, fenced-in dog park and brand-new pickleball courts. There are also poolside grilling stations and a 24-hour fitness center.
The upgraded units feature white shaker-style cabinets with brushed nickel hardware, resurfaced countertops and updated light fixtures. Some apartments have stainless steel appliances and faux wood plank flooring.
“The property is well-maintained and operating tremendously, with high occupancy rates and 10%-plus lease tradeouts,” May said.
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