Multifamily Monday: Up Close with Ari Nessel
Ari Nessel bought into nearly 5,000 apartment units last year to rehab and turn for a profit. But, the multifamily owner/developer is also there to turn dangerous eyesores into thriving communities.
The Nessel Development president (here with his family) spearheaded much of the acquisitions last year for his company, as well as many deals with partners (Presidium did most of the acquisitions along with him in 2014.) His MO: take older dilapidated properties and make them competitive at a cost that benefits both the new owner and the residents, he tells us. Much of that is increasing the aesthetic appeal, but also creating community with areas to congregate like clubhouses, pools with barbecue grills and play areas. “We want to beautify the properties and bring them up to a level they’ve never seen, even when they were new,” Ari tells us.
Interiors will see modern appliances and light fixtures, super low flow toilets, granite countertops in the kitchens and faux wood floors. Plus, he invests in making the units energy efficient. For some of these projects, there are safety issues that may require re-tenanting the property, Ari tells us. Once the majority of the units are vacant, then the turnaround can begin in earnest. Units are revamped and re-tenanted. Check out our before-and-after slideshow of his Lake Highlands Landing project.
EDGE Realty Capital Markets principal Mart Martindale (between senior associate Kevin Parrish and VP Wilson Stafford), who is working with Ari on Town Creek, says Nessel has acquired about 94% of the broken condo project units. Ari is in negotiations to buy the remainder of the complex, which has a long list of violations from both the city and fire department. Ari says the property also was a gathering point for a lot of unfavorable activity. He’s partnered with the police to help turn the area around to mesh with the surrounding neighborhoods, which have been on the rebound. With the repositioning, Ari plans to make the property safer. This year, he plans to focus on property improvements and repositioning the properties.
Ari’s goal is not to simply turn a profit, but to contribute to the community, too. As his success grew, he wanted to create a process where the profits also contributed to charitable operations. (More than 30% of Nessel’s operating income is donated to charity.) He created the Pollination Project, which contributes $1,000/day to individual change-makers and small nonprofits to help them get started. He also wants to create a corporate culture with a happy workforce. Pictured are Ari and his team at the Black Beauty Ranch this past fall. “Employees aren’t just an expense to the bottom line,” he says. “When people are happier, there is less turnover and the benefits are multiplied. When they feel their organization is doing some good in the world, they work harder and do a better job. My goal is to spend less time on acquisitions and more time on inner development.”