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Franklin Street Closes Multifamily Sale in Fort Lauderdale MSA

Franklin Street’s South Florida office brokered the sale of Bayside Manor, a 9-unit rental community in Pompano Beach, Fla., just to the north of Fort Lauderdale.  The property is located on 2205 SE 7th Street in northern Broward County.  The purchase price of $1.36 million, or $151,111 per door, represents a record sale price per door for 1950s-vintage, traditionally-leased apartment properties in the Pompano Beach area.

Franklin Street’s Dan Dratch and Greg Matus represented the buyer, Bayside Manor, LLC, a locally-based real estate investment group, and the seller, 7th Street Holdings, LP, in the transaction.  Franklin Street’s Alec Laethem provided insurance services for the asset.

“Bayside Manor was a completely vacant investment asset with zero income that sold solely based on proforma rents,” said Dratch, senior associate for multifamily investment sales. “The Pompano Beach multifamily market is trending up in terms of price per unit, cap rates are going down, and rental demand continues to grow. This transaction also demonstrates the premium that investors will pay for assets near water and downtown areas.”

About Franklin Street: Founded in 2006 during one of the toughest real estate climates, Franklin Street focused on delivering value-added solutions to meet the evolving needs of clients. Through a collaborative philosophy of leveraging the resources, expertise and experience of each of its divisions – Investment Sales, Tenant and Landlord Representation, Capital Advisory, Insurance, Property Management and Project Management – Franklin Street offers unmatched value and optimal solutions for clients nationwide. Learn more about Franklin Street at FranklinSt.com.

 
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Tampa Bay apartment rents keep rising. Here are some of the reasons why

Excerpted from Tampa Bay Times story.

Tampa Bay renters, take note: If your apartment complex is sold, your rent almost certainly will go up. And there’s a good chance your complex will be sold.

Since 2013, the bay area has been one of the nation’s most active apartment markets. Investors — be they hedge funds, insurance companies or rich local individuals — know they can make money from apartments as more people choose or are forced to go the rental route. And as the demand for apartments grows, prices climb for apartment communities.

 

“Pricing is so high on the investment side now that if they don’t raise the rents, the deal likely is not going to make any sense,” said Darron Kattan, managing director of the commercial brokerage Franklin Street. “So the business plan from Day One is raising rents.”

Tenants are safe from rent increases until their lease is up. Once it is, nothing can to stop a new owner from jacking up the monthly rent by $30, 60, even $100 or more. Rents have increased so much that half of Tamp Bay renters are “cost burdened,” a Harvard study found, and more than a fourth are “severely burdened.”

 

One reason rents are rising: the rapid turnover of apartment communities.

In the past three years, at least 172 communities with 50 or more units have changed hands in Pinellas and Hillsborough counties. The record price paid so far was $126.3 million last year for Camden Pier District, a 19-story tower with 358 units in downtown St. Petersburg. Two other bay area communities have sold for more than $100 million each since July 2017, and four have sold for between $90 million and $95 million.

“There’s a lot of value appreciation in recent years, which is enabling people to make a big profit, which is why everybody buys commercial property,” Kattan said.

In February 2017, Franklin Street brokered the sale of the 296-unit River View Apartments in Tampa for $23.4 million. A year and a half later, the complex sold for $31 million. “They did do work in that period,” Kattan said, referring to improvements made by the sellers, “but that’s still a pretty dramatic increase.”

Though investors in commercial real estate typically have to hold a property five to seven years to turn a profit, Tampa Bay’s market is so strong that “people are hitting their five to seven years value in two years,” Kattan said.

For full story, visit 

https://www.tampabay.com/news/business/2019/08/29/tampa-bay-apartment-rents-keep-rising-here-are-some-of-the-reasons-why/
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TSV and Braden Fellman Group Acquire Atlanta Apartments for $42M

Tenth Street Ventures and Braden Fellman Group bought multiple apartment buildings in Morningside/Lenox Park, Atlanta, with plans to create a unified community by rebranding them as one garden style apartment complex called The Piet. The exterior, to be painted by artist Chastain Bernard will be inspired by the neoplasticism movement with visual compositions of vertical and horizontal shapes using only black, white and primary colors to simplify and unify the buildings’ exteriors.

In this nearly $42 million transaction, TSV & BFG bought 13 buildings from multiple owners, totaling 335 units over 12.5 acres. At complex, anchored by the 2175 Lenox Road NE building, the team also plans to connect the 1960s- and 1970s-era buildings with walking trails, two pools, several dog parks, more than a dozen grill stations, bocce ball courts and putting greens. Jake Reid, Chad DeFoor and Roger Schoerner of Franklin Street’s Atlanta multifamily investment sales team, brokered the deal. Wesley C. Turner with Krevolin Hurst was the real estate attorney for the deal.

CBRE’s Yakhin B. Israel, CCIM, arranged the $40.9-million loan with lender MF1 Capital, LLC to finance the acquisition and renovation of the portfolio. The loan was funded in two phases to accommodate the sponsors’ closing timeline for the assemblage, which included three different sellers. MF1 closed the first phase in 10 business days.

TSV and BFG have created a strategic partnership combining Braden Fellman’s proven track record in the multifamily space with Tenth Street Venture’s design-focused renovations. Tenth Street is a dynamic collaborative of developers, designers and builders who are bringing more affordable market rate housing to Atlanta. Founded in 1981, Braden Fellman owns and manages more than 1,700 apartment units and 55,000 square feet of commercial space in metro Atlanta.

“We approach real estate differently,” said Brian McCarthy, a principal at TSV. “We find older properties that could use some attention and give them a design-focused renovation that appeals to our target market keeping the current and future residents in the forefront of our design decisions. We make decisions on what’s best for the end user without overspending. That’s because we have a vision and plan to keep these renovated, beautiful homes within reach so that Atlanta continues to have housing at more affordable prices and make people proud of where they live.”

Added Andrew Braden of Braden Fellman, “This joint venture was created by a group of innovators who are thinking about real estate in a completely different way. The duo is similar to any new tech start-up in that they we are generating innovative ways to tackle the current challenges related to providing housing. We’re not afraid to contest conventional ways of thinking. I expect amazing things out of our team over the next 5 to 10 years and beyond.”

TSV – which buys, designs and renovates properties with their in-house team – has gone from zero assets under management to over $100 million and 500+ units nationally in the last two years. TSV is led by an under-40-year-old management team, trained at the top commercial real estate companies and universities in the country in deal structuring, finance, asset and property management, construction management, architecture and design.

“TSV’s relatively fast growth has been impressive, a result of the combination of solid relationships, savvy project choices, smart financing and excellent execution,” said CBRE’s Israel, the finance partner who arranged the debt for the acquisition of the Morningside apartments. Mr. Israel also recently arranged a $9.8 million bridge loan with MF-1 for the TSV/BFG acquisition and renovation of a 67-unit apartment community in Decatur, Ga.

TSV is working on raising new funds from investors for other similar investments this fall. TSV has been focusing on buying older buildings in popular intown neighborhoods then either renovating to sell as condos or lease as apartments. A few recent projects include:

In the spring, TSV opened Studio9Forty, an apartment project just blocks from Piedmont Park with spacious apartments and décor inspired by Studio 54, and offers residents the option to Airbnb their units if desired.

In Buckhead, TSV renovated older buildings to develop Portico, where people can buy large, 2-bedroom condos for as low as $275,000.

Also in Midtown, TSV recently purchased an apartment complex on Crescent Street at 13th Street that includes Tin Lizzy’s and Sutra Lounge and 14 units above creating a very unique opportunity for a new type of mixed-use project.

TSV and BFG purchased three Decatur apartment complexes, including Adair Oaks, and plan to renovate the 100+ units using a protégé of Ryan Gainey, the renowned landscape architect who called Decatur home and had lived one street over. Cooper Sanchez will work on the landscape design and art for the exterior using Gainey’s essential design philosophies.

About Tenth St. Ventures

Tenth Street Ventures (TSV) is a full-service real estate group specializing in acquiring and enhancing intown real estate assets in highly desirable locations. Each investment is tailored to capture the unique energy of the surrounding neighborhood. TSV employs a two-pronged approach: First, to capitalize on up-and-coming submarkets in the path of development, and second, to breathe new life into established neighborhoods with imaginative, ahead-of-the-curve projects. The TSV team is a curated partnership of professionals, spanning a variety of industries, who share a common vision.

The team’s background includes accounting, financial structuring, asset and property management, acquisitions and dispositions, deal structuring, development planning, construction management, brokerage, investor relations, architecture, design and marketing. The combined expertise and the team’s past success is the foundation on which future, successful ventures are built. For more information, visit https://tenthsv.com/

About Braden Fellman Group

Braden Fellman Group is focused on providing unique and original spaces in intown locations. BFG currently owns and manages more than 1,700 apartment units and 55,000 square feet of commercial space. BFG provides total real estate, management, and construction services for clients primarily in the Atlanta market. Since 1981, BFG has built, bought, sold and renovated thousands of apartment units throughout the Southeast. BFG has development expertise in adaptive reuse projects, lofts conversions, ground up/midrise apartment construction, residential construction, condo conversions and other commercial properties. For more information, visit bradenfellman.com

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Atlanta Value-Add Portfolio Sells for $42M

Excerpted from Multi-Housing News story.

Tenth Street Ventures and Braden Fellman Group have acquired 13 properties from three sellers in the Morningside/Lenox Park neighborhood in Atlanta for approximately $42 million and will create one unified garden-style community with 335 units that will be rebranded The Piet.

The properties span 12.5 acres and will be connected with walking trails. Community amenities will also include two pools, five dog parks, more than a dozen grill stations, basketball courts, bocce ball courts and putting greens. Artist Chastain Bernard, using the abstract neoplasticism style made famous by Piet Mondrian with black, white and primary colors, will paint the buildings’ exteriors to unify the properties.

The joint venture partners expect to invest about $25,000 per unit in interior and exterior renovations, Brian McCarthy, TSV principal, told Multi-Housing News. Most of the money will be spent on the interiors to modernize and upgrade the1960s- and 1970s-era buildings. Upgrades will include quartz countertops, all new cabinets, new flooring and laundry hookups. The units will have updated technology, including smart locks, doors and thermostats. All the renovations are expected to complete within 18 months.

Aimed at working-class renters, McCarthy said the goal will be to keep the rents under $1,400 or as he put it, “market-rate affordability.”

McCarthy said the joint venture acquired a 117-unit property nearly a year ago and began the process of adding the other nearby properties to create the larger portfolio. They closed on the last property about 30 days ago.

Jake Reid, Chad DeFoor and Roger Schoerner of Franklin Street’s Atlanta multifamily investments sales team brokered the deal. Wesley Turner with Krevolin & Horst was the real estate attorney for the deal.

For full story, visit https://www.multihousingnews.com/post/value-add-atlanta-portfolio-sold-for-42m/

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Tenth Street Ventures & Braden Fellman Group Purchase Morningside/Lenox Park Apartments for Nearly $42M

Tenth Street Ventures and Braden Fellman Group bought multiple apartment buildings in Morningside/Lenox Park, Atlanta, with plans to create a unified community by rebranding them as one garden style apartment complex called The Piet. The exterior, to be painted by artist Chastain Bernard will be inspired by the neoplasticism movement with visual compositions of vertical and horizontal shapes using only black, white and primary colors to simplify and unify the buildings’ exteriors.

In this nearly $42 million transaction, TSV & BFG bought 13 buildings from multiple owners, totaling 335 units over 12.5 acres. At complex, anchored by the 2175 Lenox Road NE building, the team also plans to connect the 1960s- and 1970s-era buildings with walking trails, two pools, several dog parks, more than a dozen grill stations, bocce ball courts and putting greens. Jake Reid, Chad DeFoor and Roger Schoerner of Franklin Street’s Atlanta multifamily investment sales team, brokered the deal. Wesley C. Turner with Krevolin Hurst was the real estate attorney for the deal.

CBRE’s Yakhin B. Israel, CCIM, arranged the $40.9-million loan with lender MF1 Capital, LLC to finance the acquisition and renovation of the portfolio. The loan was funded in two phases to accommodate the sponsors’ closing timeline for the assemblage, which included three different sellers. MF1 closed the first phase in 10 business days.

TSV and BFG have created a strategic partnership combining Braden Fellman’s proven track record in the multifamily space with Tenth Street Venture’s design-focused renovations. Tenth Street is a dynamic collaborative of developers, designers and builders who are bringing more affordable market rate housing to Atlanta. Founded in 1981, Braden Fellman owns and manages more than 1,700 apartment units and 55,000 square feet of commercial space in metro Atlanta.

“We approach real estate differently,” said Brian McCarthy, a principal at TSV. “We find older properties that could use some attention and give them a design-focused renovation that appeals to our target market keeping the current and future residents in the forefront of our design decisions. We make decisions on what’s best for the end user without overspending. That’s because we have a vision and plan to keep these renovated, beautiful homes within reach so that Atlanta continues to have housing at more affordable prices and make people proud of where they live.”

Added Andrew Braden of Braden Fellman, “This joint venture was created by a group of innovators who are thinking about real estate in a completely different way. The duo is similar to any new tech start-up in that they we are generating innovative ways to tackle the current challenges related to providing housing. We’re not afraid to contest conventional ways of thinking. I expect amazing things out of our team over the next 5 to 10 years and beyond.”

TSV – which buys, designs and renovates properties with their in-house team – has gone from zero assets under management to over $100 million and 500+ units nationally in the last two years. TSV is led by an under-40-year-old management team, trained at the top commercial real estate companies and universities in the country in deal structuring, finance, asset and property management, construction management, architecture and design.

“TSV’s relatively fast growth has been impressive, a result of the combination of solid relationships, savvy project choices, smart financing and excellent execution,” said CBRE’s Israel, the finance partner who arranged the debt for the acquisition of the Morningside apartments. Mr. Israel also recently arranged a $9.8 million bridge loan with MF-1 for the TSV/BFG acquisition and renovation of a 67-unit apartment community in Decatur, Ga.

TSV is working on raising new funds from investors for other similar investments this fall. TSV has been focusing on buying older buildings in popular intown neighborhoods then either renovating to sell as condos or lease as apartments. A few recent projects include: 

* In the spring, TSV opened Studio9Forty, an apartment project just blocks from Piedmont Park with spacious apartments and décor inspired by Studio 54, and offers residents the option to Airbnb their units if desired.
* In Buckhead, TSV renovated older buildings to develop Portico, where people can buy large, 2-bedroom condos for as low as $275,000.
* Also in Midtown, TSV recently purchased an apartment complex on Crescent Street at 13th Street that includes Tin Lizzy’s and Sutra Lounge and 14 units above creating a very unique opportunity for a new type of mixed-use project.
* TSV and BFG purchased three Decatur apartment complexes, including Adair Oaks, and plan to renovate the 100+ units using a protégé of Ryan Gainey, the renowned landscape architect who called Decatur home and had lived one street over. Cooper Sanchez will work on the landscape design and art for the exterior using Gainey’s essential design philosophies.

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Ask the Expert: How does Franklin Street use technology to empower its agents?

Ask the Expert: How does Franklin Street use technology to empower its agents?

“Our firm has created a tailored learning management system (LMS) called Franklin Street University, led by our chief learning and development officer. It’s an online educational platform whose main function is to equip all new associates and experienced agents in their respective business lines with on-demand video lectures and assessments, facilitated through the firm’s established stages of learning and development.

Franklin Street agents are given access to drone photography and videography to best showcase a commercial property’s location. We leverage drone pilots to capture aerial video and photos to highlight a client’s investment property that is for sale. This state-of-the-art technology allows for quick deployment and turnaround time to hit the market sooner than in previous eras. Video takes it a step further by providing a more immersive experience, like some of the ‘walkable’ image format experience used by our leasing team. 

Lastly, our producers take advantage of third-party marketing tools to streamline and automate portions of the marketing process, like packages, flyers, eblasts, and reporting, while being synced to our proprietary customer relationship management (CRM) system. This functionality allows for a company-wide brand experience that is consistent and less prone to data error. From time to time, we may also use auction sites and other available listing services (which are becoming more and more popular as tech applications today) to expand our reach, marketing to a wider audience pool.”

Greg Matus
Senior Vice President, Investment Sales
Franklin Street
Greg.Matus@FranklinSt.com
954.640.1100 ext. 0501  

 
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TSV and Braden Feldman Group buy Atlanta apartments for nearly $42 mln

Excerpted from PEI Media story.

Tenth Street Ventures and Braden Fellman Group bought multiple apartment buildings in Morningside/Lenox Park, Atlanta, with plans to create a unified community by rebranding them as one garden style apartment complex called The Piet. The exterior, to be painted by artist Chastain Bernard will be inspired by the neoplasticism movement with visual compositions of vertical and horizontal shapes using only black, white and primary colors to simplify and unify the buildings’ exteriors.

In this nearly $42 million transaction, TSV & BFG bought 13 buildings from multiple owners, totaling 335 units over 12.5 acres. At complex, anchored by the 2175 Lenox Road NE building, the team also plans to connect the 1960s- and 1970s-era buildings with walking trails, two pools, several dog parks, more than a dozen grill stations, bocce ball courts and putting greens. Jake Reid, Chad DeFoor and Roger Schoerner of Franklin Street’s Atlanta multifamily investment sales team, brokered the deal. Wesley C. Turner with Krevolin Hurst was the real estate attorney for the deal.

 

For full story, visit https://www.pehub.com/2019/08/tsv-and-braden-fellman-group-buy-atlanta-apartments-for-nearly-42-mln/

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Lack of US Affordable Housing Turns Dated Apartments Into Investor Darlings

Excerpted from CoStar News story.

Rising costs of land, labor and materials have made it more profitable for developers to build luxury projects, leading to a shortage of units for middle-class residents, brokers and analysts say. In fact, government assistance is needed to close income gaps so more people can reduce exorbitant housing costs, according to a report released this summer by the Joint Center for Housing Studies at Harvard University.

“It’s very difficult, almost impossible, to develop the kind of apartments that the working class can afford,” Zach Ames, senior director for the Franklin Street brokerage in Tampa, Florida, said in an interview. “I don’t know that that’s going to change. It will continue to make value-add a hot subsection of multifamily.”

For full story, visit https://www.costargroup.com/

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Ask the Expert: What Tampa submarket is a hot spot for new retail development?

Ask the Expert: What Tampa submarket is a hot spot for new retail development and what are the driving factors?

“Pasco County is one of the fastest growing areas in Tampa Bay. Specifically, the Wesley Chapel submarket and the State Road 54 corridor have been the hot spots to watch for new retail development. 

Among the driving factors are the modern residential communities being developed and the amount of single-family homes being sold. These homes provide a lower cost of entry than neighboring cities like Tampa, Clearwater, and St. Petersburg, making them an attractive alternative for new families and young professionals. Pasco County’s strong employment incentive programs also provide a major draw for new businesses, helping to create more employment opportunities. 

In addition to the area’s population growth and increased economic opportunity, the Pasco-SR54 market is attractive to retail developers due to the large amount of undeveloped land in close proximity to these new residential communities, with infrastructure in place to connect the area with the rest of the region.”

Anthony Suarez
Senior Associate, Retail Investment Sales
Franklin Street of Tampa
Anthony.Suarez@FranklinSt.com
813.839.7300 Ext: 0393

 
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St. Johns Town Center preparing expansion with theater, hotel and more

Excerpted from Jax Daily Record story.

The St. Johns Town Center regional “main street” and lifestyle center has grown to 1.4 million square feet of retail and restaurant space.  News releases show it features 11 anchor stores and more than 175 brand-name specialty stores, along with the park green and a courtyard.

The center was developed on Skinner family land and owned 50-50 by Atlanta-based Ben Carter Properties and Simon Property Group of Indianapolis.

The Carter group sold its 50 percent ownership in June 2014 to Deutsche Asset & Wealth Management’s Real Estate Investment Group for a reported $375 million. 

Carrie Smith, managing director of the Franklin Street real estate company, said the potential expansion reflects the health of the trade area around St. Johns Town Center.

“Simon knows what kind of volume their current client base is doing at Town Center. It continues to speak about kind of strength the St. Johns Town Center has in our market,” she said.

For full story, visit https://www.jaxdailyrecord.com/article/st-johns-town-center-preparing-expansion-with-theater-hotel-and-more