Bomasada Group says, 'Meet us near St. Louis' Houston-based Bomasada Group Inc. has purchased 20 acres in O'Fallon, Mo., for the development of The Enclave at WingHaven Apartments. The $30.7 million, 400-unit luxury apartment complex is owned by St. Louis Enclave Apartments Ltd., a partnership that is directed by Stuart L. Fred and John L. Gilbert, principals of Bomasada Group. Construction started in March, and the first apartments will be ready for occupancy this fall. Completion of the entire complex is slated for summer 2001.
The complex will be in the WingHaven master-planned community, a $600 million, 1,100-acre mixed-use development that is the future home of MasterCard's Global Technology and Operations Center. Bomasada Group, which is the exclusive apartment developer for WingHaven, also has plans to build another 455 units on an adjacent site.
The Enclave will feature five floorplans with an average apartment size of 952 sq. ft. Each unit will be furnished with washer and dryer connections, ceiling fans and patios or balconies, while certain apartments will contain fireplaces and built-in bookshelves.
Other amenities will include a resort-style swimming pool, tennis courts and car wash. A 6,000 sq. ft. clubhouse will feature a fitness center, movie theater and business center.
Alliance grows bigger with $136.5M purchase Chicago-based Alliance Holdings has purchased a 3,609-unit portfolio of Southeastern apartment complexes for $136.5 million. Richmond, Va.-based Cornerstone Realty Income Trust was the seller, and Charlotte, N.C.-based Berkeley Capital Advisors LLC was the lone broker involved in the.
The properties, which on average are 94% occupied, are located in North Carolina, South Carolina, Virginia and Georgia. The five largest properties involved were Savannah West, a 456-unit complex in Augusta, Ga.; Polo Club, a 365-unit community in Greenville, S.C.; Sailboat Bay, a 358-unit complex in Charlotte, N.C.; Windlake, a 299-unit community in Greensboro, N.C.; and Breckinridge, a 236-unit complex in Greenville.
Like James Taylor, JPI has Carolina on its mind Irving, Texas-based JPI has begun construction of the first phase of Jefferson at Cary Towne, a luxury apartment complex in Raleigh, N.C. Construction of phase one, which will consist of 354 units, is expected to be complete by January 2002, although the first apartments will open in February 2001. JPI will begin building a 256-unit second phase in January 2002. Cline Davis Architects of Raleigh is designing the complex.
Jefferson at Cary Towne will offer one-, two- and three-bedroom floorplans, with units ranging from 722 sq. ft. to 1,289 sq. ft. Rents will range from $690 to $1,100 per month. Amenities will include in-unit washers and dryers, gas fireplaces and garden-style bathtubs. A community clubhouse will feature a fitness center, coffee bar and a children's play area.
JPI has been busy in North Carolina lately. The company recently completed the 492-unit Jefferson Creekside in Charlotte and now has more than 1,000 apartments under development in the state.
Seek shelter in Frederick, Md., at The Reserve complex Shelter Development LLC, a division of The Shelter Group in Baltimore, has begun construction of The Reserve at Ballenger Creek in Frederick, Md. The first luxury apartments in the $16 million, 204-unit complex will be ready for occupancy by August. Completion of the entire community is slated for January 2001. Stamford, Conn.-based GE Capital Corp. is The Shelter Group's equity partner on the project, while Charlotte, N.C.-based Bank of America is the lender.
The complex, which will be a part of a mixed-use planned unit development, will offer one-, two- and three-bedroom floorplans. Each unit will feature a washer and dryer, ceiling fans and a balcony. The community will also have a pool and a clubhouse as well as a business room.
On the waterfront: New Jersey complex refinances loan Florham Park, N.J.-based Commercial Mortgage Capital has arranged a $41 million long-term mortgage loan for Florham Park, N.J.-based Kushner Cos. to refinance the construction loan for The River Club in Edgewater, N.J. Bernardsville, N.J.-based Larson Financial Resources provided financing through McLean, Va.-based Freddie Mac, which satisfied Kushner's existing debt to Bank of New York.
Constructed in 1998 and located on the Hudson River, the 266-unit River Club is nearly 100% leased, with rents ranging from $1,700 to $2,600 per month. The complex features one- and two-bedroom units. Amenities include a pool and fitness club.
Apartments for Tampa students on the way Houston-based L.J. Melody & Co. has arranged $35.5 million in financing for Campus Lodge Apartments, a 312-unit complex in Tampa, Fla., for students from the University of South Florida. The borrower was Gainesville, Fla.-based Campus Development Group. Completion is slated for August 2001, although some units will be available this August.
Regions Bank in Tampa provided approximately $28.4 million in construction financing, while Tampa-based Euro-American Management Inc. provided $7.1 million in equityfinancing for the project.
Despite steady job growth, the competition between the two property types has resulted in rental growththat is not as strong as it could be. "There's some growth, but it's not that impressive," he says.
In 1999, thearea saw about a 4% growth in rents; this year, growth should be around 3.5% to 4%. "With vacancies around 4%, you really should be seeing more robust rent growth," says Nadji.
Atlanta, Chicago rocking right along Analysts and researchers at Palo Alto, Calif.-based Marcus & Millichap have been busy bees lately, publishing dozens of apartment reports on cities nationwide. The company reports that Atlanta, feeling the rush of a prosperous but slightly slowing economy and a surge of high-tech jobs, will continue to see strong apartment construction in 2000. The area will also witness a slight increase in vacancy rates and moderate rent growth. Further north in Chicago, the market remains healthy despite rising interest rates.
"The theme for Atlanta is continued construction in the face of slower economic activity," says Hessam Nadji, senior vice president and national director of research for Marcus & Millichap.
Nadji reports that in 1998, the Atlanta metro area created about 70,000 new jobs. That statistic grew to approximately 80,000 in 1999, but could slip to around 65,000 this year. "That is still a very healthy job growth rate," he notes.
Fueled in part by the booming job growth and low unemployment levels, apartment construction in Atlanta has been strong, topping 10,000 new units per year in recent years. Several counties in the area have issued building moratoriums, the report says.
The Atlanta report predicts that new apartment starts will total approximately around 10,000 this year as well, although Nadji says the total could dip below that mark. The Chamblee, Midtown and North Fulton submarkets can each expect more than 1,000 new units this year, the report says.
During the past couple of years, Atlanta's vacancy rate has been moving upward from the 1998 average of 6.7% due to the robust construction activity, the report says. At the beginning of this year, the rate was 7.4% and could increase to 7.7% by the end of 2000. "Strong demand is expected to prevent vacancy from rising a great deal," the report adds. Metro Atlanta can also expect rents to increase by about 3.25% in 2000.
"Given the construction boom and slower job growth, the [Atlanta] market has held together surprisingly well," adds Nadji.
Meanwhile, in Chicago, rising interest rates have not slowed down apartment sales, notes Marcus & Millichap. "Apartment transaction activity across the market remained strong and actually increased in 1999, due in part to continued strong competition among investors for a relatively limited number of properties for sale," says the report.
Last year, approximately 475 apartment sales worth $500,000 apiece took place in the Chicago market. In 1998, there were about 316 such sales. However, increasing interest rates "have contributed to a gap between buyer and seller expectations as to price," notes Marcus & Millichap.
For the buyer, rising debt-service costs mean a reduction in cash flow. Meanwhile, sellers are looking for higher prices because of upward pressure on rents and a general shortage of apartments. "On the whole, however, the market remains strong," adds the report.
The battle between condominiums and apartments in Chicago is something to watch, says Nadji. According to the report, Chicago condominium and apartment markets will each see the construction of about 4,000 units this year. By 2002, the condominium boom could peak, adds Nadji.
For more information on the Chicago market, turn to page 107 for our area review of the Windy City.