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As multifamily fundamentals shift over the next two years, Class-A product will be well-poised to dominate the market in rental growth, and a Texas buyer just snagged a property to ride that wave.
Olympus Property, a Fort Worth-based investment firm, purchased a 341-unit Class-A garden-style apartment, Broadstone Sierra Pines, in The Woodlands. Competition within the multifamily investment market remains robust in the Bayou City, principal Chandler Wonderly said.
“With limited new construction in the surrounding area, an exclusive resident base and close proximity to large employers, the property’s location demonstrates Houston’s growth and consistent transactional volume,” Wonderly said in a release.
Multifamily construction has slowed for the second consecutive year in the greater Houston area, according to the Marcus & Millichap Q3 multifamily report. Deliveries dropped from nearly 19,400 units in 2017 to 12,600 units scheduled this year. Vacancy stands at 6.2% for the third quarter, but expect year-end deliveries may surpass 2017's vacancy.
With a decelerating pipeline projected over the next two years, the existing Class-A product serves the highest potential for rental growth, Berkadia Director Jennifer Ray told Bisnow. Ray and Ryan Epstein represented the seller, Phoenix-based Alliance Residential Co.
As the economy is set to create 100,000 jobs this year and continue to soar next year, Houston is positioned to be one of the best markets in which to invest in the nation, Ray said. She is already noting an influx of capital into the market, and she predicts even more interest going forward.
Broadstone Sierra Pines is at 1615 Sawdust Road. The community has one- and two-bedroom units and features solid bamboo flooring, designer carpeting, granite countertops, stainless steel appliances, full-size washer and dryer, and ceiling fans with custom lighting.
On-site amenities include a social clubroom, a fitness center, a yoga space, a private massage center, an executive business lounge and a zen courtyard. It is also conveniently situated near the large employment hubs and major thoroughfares.
Berkadia's Tucker Knight and Nicholas Murphy represented the buyer. Fannie Mae provided a 10-year loan with seven years interest-only.
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