A Washington state apartment investor is adding to its Atlanta inventory with another suburban property, another investor seeking multifamily opportunities outside of the city's urban core.
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Wilkinson Corp. purchased the Retreat at Arc Way, a 284-unit, Class-B apartment complex in Norcross, a suburban area in Metro Atlanta's northern quadrant off Interstate 85. Wilkinson paid $24.8M, or about $87,300/unit, to an LLC registered to a division of Crown Holdings Group, the same group that owns and is attempting to redevelop the former Gold Kist headquarters building in Central Perimeter.
This makes Yakima, Wash.-based Wilkinson's sixth Atlanta apartment holding, most of which are in suburban Atlanta, including Orchard Springs and Garden Terrace in Marietta and Riverview Apartments in Canton.
“We're not opposed to playing in the urban core. And we definitely looked at some product,” Wilkinson vice president of acquisitions George Waymire said. “Primarily, we're more of a garden-style-type owner.”
It is a product type in the realm of multifamily that still holds value-add opportunities, Waymire said. In Retreat's case, the circa 1980s property will be infused with up to $10k per unit in updates, with the goal of pushing rents higher, he said. He did not disclose current rents. On average, Waymire said rents in the Atlanta portfolio have seen 6% to 8% growth over the past year.
Atlanta is one of Wilkinson's target markets, along with Texas, Indiana and Minneapolis.
“Atlanta is one of our long-term markets," Waymire said. "We like Atlanta, and we take the approach of more of a laser focus versus a shotgun approach. The better you know a market, the better you can react to transactions."
But finding value-add is a tough process in this stage of the real estate cycle, he said. And Wilkinson is not finding those potential buys on its home turf at this point.
“We found it a little bit challenging to do anything in Washington state,” he said. “Everybody wants to be on the West Coast. There's value out here. But it doesn't quite fit our current investment criteria.”
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