ALEXANDRIA, VA-AREA Property Partners has acquired a workforce housing apartment community here called EOS 21. The company declined to discuss pricing with GlobeSt.com, however a source tells us that the 20-building, 1,180-unit property traded for $192 million, or $162,712 per unit. The cap rate is 5.49%.
The company likes the value proposition that workforce housing and this particular location offers, James H. Simmons III, AREA partner, tells GlobeSt.com. “We are bullish on the greater Washington, DC submarket—particularly the portion that is between luxury and what I would define as class C multifamily. We are aiming to create A quality apartments that are affordable to the broadest swath of working individuals.” He adds that the company doesn’t have immediate plans for additional acquisitions.
Indeed, competition is intense for product at almost every point of the multifamily spectrum, Ari Firoozabadi, president of The Greysteel Co., a locally based boutique investment sales firm, tells GlobeSt.com. “Although there is speculation on job and rent growth stagnation in the Washington DC area, the institutional buyer community still has more value-add equity to spend than there is product,” he says.
EOS 21 is located close to the Van Dorn Metro. AREA plans to make a number of improvements including upgrading the common area and renovating units. Simmons said with the recent rent increases at newer buildings in the submarket, the company expects it will be able to generate revenue growth organically.
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