Class C Apartments Near Buckhead Net $2.8M

Lin Properties, a private Atlanta investor, paid locally based Park Village Associates LLP $41,176 per unit for the 88%-leased apartment complex, acquiring it at a 7.75% cap rate.

"This shows the strength of demand for class C properties in metro Orlando," Joshua Goldfarb, a senior broker at Atlanta-based Southeast Apartment Partners tells GlobeSt.com. "While this asset's cap rate was an exception, due to it's 'A' location just north of Buckhead and inside I-285, most C class assets are trading for lower cap rates than 18 months ago."

Marc G. Robinson, managing director, Southeast Apartment Partners, who worked with Goldfarb in negotiating for the seller and finding the buyer, tells GlobeSt.com the transaction "represents a very strong price, in light of the softness in the market."

Goldfarb says the deal "indicates that values have held up reasonably well, especially compared to A and B class assets, even though operations have dropped off, due to the general economic conditions."

The broker tells GlobeSt.com cap rates are down due to "lack of alternative investments, such as the stock market, and very favorable financing." He says this principle applies largely to the type of assets Southeast Apartment Partners sells--class B and C multifamily assets typically under $15 million and targeted to private capital buyers.

"These principles should remain intact for the short run. The mid-term to long-term outlook is less certain and largely depends on the interest rate and stock market moves." However, he says "movement in these sectors may be a result of an improved economy and perhaps improved apartment operating performance."

Park Village monthly rents are $500 to $900. The property comprises eight studio units, 16 one bedroom-one-bath units; 38 two-bedroom-two-bath units and six three bedroom-two-bath units.