Multifamily's Maximal Momentum
Multifamily in Charlotte and the Carolinas still has its mojo--lenders are still willing to lend for it, and investors are still looking to buy it because they both believe in the sector’s upside for years to come. (We believe the children and Charlotte are our future.)
Demand for multifamily loans in the Carolinas continues to be strong in all sectors, as job growth strengthens and population growth expands, Grandbridge Real Estate Capital SVP Michael Ortlip tells us (snapped at a Bisnow event last year). That doesn’t mean that they’re throwing money at any deal that comes their way, however. “Lenders may be more circumspect about certain submarkets in 2014,” he says. (We all get a little picky at the buffet.) Still, financing will be readily available throughout the year for good deals--and there will be a good number of those.
Recently Grandbridge closed on a $33M fixed-rate first mortgage for the 325-unit Boulevard Apartments in Mount Pleasant, SC (pictured), and a $23M fixed-rate first mortgage for the 184-unit Apartments at Quarterside in Charlotte. “A variety of lenders were interested in providing first mortgage financing for the Boulevard,” says Mike. “The Beach Co did a great job of developing a property with institutional appeal.”
Investors are still keen on the sector as well. Legacy Partners Residential senior managing director Timothy O'Brien tells us that, with continued demand growth and low apartment supply, the company’s optimistic about the Charlotte area, especially the Concord submarket. Fueled by growth in the banking and energy sectors, Charlotte is projected to add 25,000 jobs in 2014, he says, citing ISI Group's February 2014 report. Recently California-based KBS Legacy Partners Apartment REIT acquired the 240-unit Legacy Grand at Concord in Concord, which is 91% occupied, for $28M. The REIT also owns the 301-unit Wesley Village in Charlotte. (Doesn't that pool look nice after the winter we've had?)