Nationally there are worries that Class-A multifamily's reaching peak pricing, but that isn't deterring investors from pursuing Class-B value-add assets in strong markets.
Recently NorCal-based Jackson Square Partners snapped up a Class-B portfolio consisting of The Bluffs at Castle Rock and Center Pointe East, in Castle Rock and Aurora, respectively, for more than $68M. ARA Newmark executive managing director Shane Ozment tells us the Castle Rock property alone received over 20 offers, with pricing extremely crowded at the top. "It was a true value-add opportunity," he explains.
Bluffs at Castle Rock is 99% occupied and Center Pointe East (pictured) is 96% occupied, and both properties are in areas seeing strong job growth. In the case of each property, some of the units were renovated before the sale, and these command higher rents—which points to an opportunity for rent growth when more renovations are done. Shane, along with colleagues Terrance Hunt, Jeff Hawks and Doug Andrews, repped the seller, Texas-based LYND.
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