515-Bed Tiger Manor Sells to Regional Buyers

LAFAYETTE, LA-The adage of "location, location, location" worked in favor of the 515-bed Tiger Manor, a student housing complex that sold for $24.25 million. During the bidding process, the property, which serves Louisiana State University, attracted 14 qualified offers, with regional investors buying the property from GRS Property Management of Lake Worth, FL.

J. Ryan Lang, director, multifamily group investment properties with Stirling Properties of New Orleans acknowledges he had some concerns when he brought the product to market, as the student housing property at 3000 July St. had a wrinkle in the form of 32 on-site condominiums sold to private owners. The 1970s property had been converted to condos during the mid-2000s, with several units sold before the market collapsed, leaving the remainder as rentals.

"The condo issue did scare off some people right off the bat, the majority was willing to overlook the condo aspect because of the location and the value left in it," says Lang, who represented GRS throughout the marketing and sales process. "We had a ton of interest from just about every group of investors – institutional guys, student housing operators and regional and local guys."

Lang tells GlobeSt.com that the eventual buyers, operating under the name Tiger Manor LLC, offered better terms than other bidders and was able to offer a faster closing. The period between contract signing and closing was a little morethan 60 days.

The student housing property boasted a 98% occupancy. At the time it came to market last spring, however, occupancy was in the low 80s. Lang acknowledges that spring and early summer isn't the best time to bring a student housing property to market, which is what made the competitive bidding on the asset that much more compelling.

Lang points out that potential bidders liked the asset because it is directly across the street from the LSU campus. Furthermore, the property's cap rate was discounted by 75 basis points, due to the condo component. "This offered a chance for investors to come in, get an A-location product at a discounted rate to what they'd have to pay on a core asset," Lang adds.