The low-hanging fruit, and even many of higher-up morsels, might be gone from gateway markets for apartment investors, but they are still after the pickings in secondary markets like Charlotte.
N.Y. boutique firm Gamma Real Estate likes Charlotte-area multifamily so much it not only bought one property in the market — as recently reported — it bought two.
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Gamma president Jonathan Kalikow said both properties were acquired below replacement cost, with rents below average in the north Pineville submarket. The market, by contrast, has shown considerable employment and rent growth recently, with rents registering a 21% increase from 2010 to 2015, he said, a function of supply constraint.
The assets are Whitehall Estates and Stone Ridge, totaling 570 units and both bought from YFP/Yager Properties, a Charlotte-based owner. Whitehall Estates is 92.5% occupied and traded for $30.9M, while Stone Ridge is 94% occupied and sold for $43.2M.
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"Stone Ridge and Whitehall Estates already have strong in-place cash flow and total return," Kalikow said. "Combined with our interior and exterior value-add improvements, we see strong future rent growth for the coming years.”
Cushman & Wakefield's Jordan McCarley and Marc Robinson repped the seller. “We’re continuing to see high demand for quality assets in solid suburban submarkets, especially if there’s a value-add component,” McCarley said.
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