ATLANTA—Steadfast Apartment REIT just spent $98.5 million on two multifamily assets with 696 apartment units in Atlanta's North Gwinnett submarket. Steadfast will operate the two properties as The Residences on McGinnis Ferry.

Residences on McGinnis Ferry is located 30 miles northeast of Downtown Atlanta and has average in-place rents of $1,068 with 40 garden-style residential buildings, offering one-, two- and three-bedroom floor plans averaging 1,217 square feet. The assets are 97% occupied.

“We specifically seek to acquire properties in areas that have demonstrated continued economic growth and a strong renter pool,” says Ella Shaw Neyland, president of Steadfast. “The greater Atlanta market continues to improve and is supported by employment growth of nearly 6% since 2010. In addition, the local apartment market remains positive due to limited new supply coming on line and a general decline in homeownership.”

The North Gwinnett submarket is one of Georgia's wealthiest suburban submarkets. Family Circle Magazine named it as one of the “Top 10 Best Places to Raise a Family.” Since the recession, the Atlanta MSA has diversified its economy and is home to 16 Fortune 500 companies, including The Home Depot, Coca-Cola, and Sun Trust Banks. The area has also been ranked “Top 10 Happiest Places for Young Professionals,” all of which Steadfast believes will continue to drive apartment demand in the market.

“While the property is well-regarded in the local area, we see an opportunity to update and align the amenities to reflect the requests of today's renters,” says Neyland. “Additionally, the two-property layout provides an opportunity to establish separate identities and branding in order to optimize the revitalization and rent increase strategy.”

Steadfast has committed to a capital improvement plan on the apartment interiors as part of its value enhancement strategy at both properties. The plan includes black appliances, 2-foot faux wood blinds, vinyl plank flooring, and upgraded countertops, cabinets, hardware, and fixtures in the kitchen and bathrooms.

“Apartments are hot,” Mike Cohn, regional president and co-founder of Lennar Commercial, tells GlobeSt.com. “In fact, the youngest of the Baby Boomers and the oldest of their Millennial children want to live in an authentic urban environment with walkable services and full service amenities, and both groups are willing to pay for the convenience.”