A 292 Unit, Garden-Style, Multi-Housing Community in Gainesville, Georgia

Transcription

1 A 292 Unit, Garden-Style, Multi-Housing Community in Gainesville, Georgia

2 The Offering Holliday Fenoglio Fowler, L.P. ( HFF ) is pleased to exclusively present the tremendous opportunity to acquire LENOX PARK, a 292-unit, garden style multi-housing community in Gainesville, Georgia. Lenox Park is in excellent physical condition and can be acquired at an extremely attractive basis, well below replacement costs. The Gainesville economy has established itself as a selfsustaining business hub of Northeast Georgia, energized by recent population growth and the announcement of notable employer expansions and relocations to the area. In 2000, Lenox Park was developed under Section 42 of the Internal Revenue Code utilizing Low Income Housing Tax Credit (LIHTC) equity. Beginning January 1, 2015, Lenox Park is eligible for entry into the Qualified Contract process, which could potentially remove the existing rent and income restrictions that encumber the Property by While current rents at the Property are below the maximum allowable under the LIHTC program, removal of the existing restrictions will provide for operational versatility and future disposition strategies will be uninhibited by the presence of a LURA. INVESTMENT SUMMARY PURCHASE PRICE: $14,500,000 PRICE PER UNIT: $49,700 CAP RATE: 7.25% PROPERTY OVERVIEW PROPERTY NAME: Lenox Park ADDRESS: 1000 Lenox Park Place CITY: Gainesville, Georgia YEAR BUILT: 2000 CENSUS TRACT: (Non-Qualified) NUMBER OF UNITS: 292 NET RENTABLE SF: 322,664 SF AVERAGE UNIT SIZE: 1,105 SF BUILDINGS: 10 Residential, 2 Community ACRES: DENSITY: 10.2 Units/Acre INCOME RESTRICTIONS: 60% AMI END OF INITIAL COMPLIANCE: December 31, 2015 Lenox Park is being offered all-cash, subject to existing rent and income restrictions as required by the LURA and Extended-Use Agreement. UNIT MIX UNIT TYPE # OF UNITS MAX LIHTC HFF PROFORMA ANNUAL PROFORMA GPI 1 Bed, 1 Bath, 60% AMI 56 $635 $565 $379,680 2 Bed, 2 Bath, 60% AMI 84 $754 $635 $640,080 3 Bed, 2 Bath, 60% AMI 76 $862 $705 $642,960 3 Bed, 2 Bath, Large, 60% AMI 76 $862 $715 $652,080 TOTALS/AVERAGES 292 $787 $661 $2,314,800 PROPERTY AMENITIES / UNIT FEATURES Clubhouse Fully Equipped Kitchens On-Site Management Washer/Dryer Connections Sparkling Swimming Pool Private Patio/Balcony Playground HVAC Laundry Facility 2

3 Investment Highlights ORGANIC GROWTH POTENTIAL Leasable units at Lenox Park are currently 96% occupied, however, 17 units at the Property are currently offline. Investors have the opportunity to significantly increase rental revenue and capitalize on strong demand within the submarket by bringing these units back online. Furthermore, renovating the offline units with modern fixtures and appliances would provide a litmus test for potential rental premiums going forward. INVESTMENT VERSATILITY Beginning January 1, 2015, Lenox Park is eligible for entry into the Qualified Contract process, which could potentially remove the current rent and income restrictions that encumber the Property. With ample room to increase market rents, removal of the existing LURA provides for operational versatility, and future disposition strategies will be uninhibited by an extended use agreement. MARK-TO-MARKET OPPORTUNITY With a clear spread between recent leased rents at Lenox Park and rents at surrounding comparable properties, new ownership stands to benefit from an immediate mark-to-market opportunity. A comprehensive survey of the surrounding rental market shows that recent two- and three-bedroom leases at the Property trail the prevailing market by approximately $36 and $50, respectively. Prevailing market rents are below the maximum allowable under the LIHTC program, so a new investor can reasonably expect to make upward mark-to-market adjustments of approximately 6%-8%, without running the risk of exceeding maximum LIHTC rents. 3

4 Investment Highlights ATTRACTIVE, WELL-MAINTAINED COMMUNITY WITH COST-EFFECTIVE UNIT MIX Constructed in 2000, Lenox Park consists of 292 units that average a spacious 1,105 square feet. Over half (52%) of the property s units are three-bedroom floor plans, a perfect fit for a market known for its family oriented tenant pool. Lenox Park stands in excellent physical condition and should require minimal capital needs going forward. Recent capital improvements, including replacement of the original roofs, contribute to the Property s market leading curb appeal, and when combined with its well suited unit mix, should allow it to operate at or above market occupancy. Each unit features a fully-equipped kitchen that includes a frost-free refrigerator, dishwasher, disposal, and an electric range and oven. Full-size washer and dryer connections are conveniently located in each kitchen pantry, and all residents enjoy access to a private patio or balcony. Lenox Park offers a comprehensive amenity package that includes a sparkling swimming pool, clubhouse, community room, playground, and laundry facility. Residents at the property also enjoy a high quality of life cultivated by a full-time, on-site management and maintenance staff. STRATEGIC LOCATION IDEALLY SUITED FOR TENANT BASE Lenox Park is conveniently accessible via US 129 which sees an average of 26,000 vehicles daily. US 129, or Athens Highway, is the major east-west thoroughfare between Athens, Gainesville, and the North Georgia mountains. Located three-quarters of a mile west of the Property, Fieldale Farms main production facility is directly accessible via US 129 and is the second largest employer in the Gainesville MSA (2,400 employees). US 129 runs directly through downtown Gainesville and intersects Interstate-985 approximately one mile west of the Property. With an average daily traffic count of 47,900 vehicles, Interstate-985 is a key transportation highway for Gainesville businesses. Lenox Park also offers an on-site bus stop serviced by Hall Area Transit (HAT) Route 1, which provides access to Downtown Gainesville, Brenau University, and the Hall Area Transit Multimodal Center. 4

5 Investment Highlights GAINESVILLE SELF-SUSTAINING REGIONAL BUSINESS HUB Gainesville, Georgia is thriving due to its strong employment base, affordability, and proximity to Atlanta and the Carolinas. As the business hub of Northeast Georgia, Gainesville s diverse economy is anchored by a host of prominent food manufacturers that include Fieldale Farms, Pilgrim s Pride, and King s Hawaiian, as well as educational and health institutions including the Northeast Georgia Health System and the University of North Georgia. 47 Fortune 500 firms have operations in Gainesville and Hall County and the Gainesville economy generated an impressive $7 billion in gross metro product in A low cost of doing business and a below average cost of living have been driving forces behind the area s explosive population growth. Gainesville offers its residents the best of both worlds: a high qualityof-life synonymous with small-town living, and the amenities and services of a major city. UNUTILIZED AMENITIES Lenox Park features a second clubhouse, though this amenity space is currently unutilized. A new owner would have the ability to make use of the space with a relatively minimal capital expenditure, and would be able to offer additional amenities or programs to attract and retain residents. Potential amenities and programs include the addition of a fitness center, the creation of after-school programs or specialized language programs designed to serve the diverse community at the Property. STRONG PUBLIC SCHOOL SYSTEM Students living at Lenox Park attend Gainesville City Schools. The Gainesville City School District includes eight charter schools, officially designated Professional Development Schools (through partnerships with Brenau University and the University of North Georgia), apprenticeship opportunities with local businesses, an International Baccalaureate Program, and open enrollment and parent choice allowing for flexibility regardless of school zoning. With diverse options available to both parents and students, Lenox Park allows residents to capitalize on a strong school system in a manner most appropriate to their needs. 5

6 LAKE LANIER $5.5 billion annual economic impact 8 million visitors annually BRENAU UNIVERSITY $150 million economic impact 2,800 students NORTHEAST GEORGIA MEDICAL CENTER $1 billion economic impact 4,000 employees 450 physicians NEW HOLLAND MARKETPLACE Kroger anchored: 123,000 square feet, one of the largest Kroger s in the southeast 300,000 square foot master planned development LAKESHORE MALL 518,000 square feet Anchors: JCPenney, Belk, Dick s, Sears DOWNTOWN GAINESVILLE 129 PILGRIMS PRIDE 1,600 employees LENOX PARK HIGHWAY 53 RETAIL CORRIDOR Over 1 million square feet of retail space MAR-JAC POULTRY 1,250 employees 23 FIELDALE FARMS 2,400 employees 11 LEE GILMER AIRPORT 38,000 flights annually 985 6

7 Transaction guidelines Lenox Park is being offered all-cash, subject to existing rent and income restrictions as required by the LURA and Extended-Use Agreement. Offer Due Date: To Be Determined Tour Schedule: Tours will be scheduled for select days during the marketing period. All property tour requests are to be made and confirmed through HFF by contacting Doug Childers ( , or Dave Wagner ( , Under no circumstances are Investors allowed to visit the Property without approval from HFF. Failure to adhere to this request will be taken into consideration by the Seller when offers are selected HFF (Holliday Fenoglio Fowler, L.P.) and HFFS (HFF Securities L.P.) are owned by HFF, Inc. (NYSE: HF). HFF operates out of 23 offices nationwide and is a leading provider of commercial real estate and capital markets services to the U.S. commercial real estate industry. HFF together with its affiliate HFFS offer clients a fully integrated national capital markets platform including debt placement, investment sales, equity placement, advisory services, loan sales and commercial loan servicing. For more information please visit hfflp.com or follow HFF on Twitter at twitter.com/hff. HFF has been engaged by the owner of the property to market it for sale. Information concerning the property described herein has been obtained from sources other than HFF and we make no representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all references to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a buyer. Buyers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change. DOUG CHILDERS Director - Affordable Housing tel (404) fax (404) dchilders@hfflp.com DAVE WAGNER Director tel (404) fax (404) dwagner@hfflp.com