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JACKSONVILLE, FL-Olympic Investors LLC of Seattle and Heitman Financial LLC of Chicago are the new joint owners of Oak Forest Apartments, a 20-year-old, 270-unit, 92%-leased multifamily community here.

The alliance purchased Oak Forest from Univesco Inc. of Dallas for $9.8 million, or about $36,296 per unit. The buyers plan to invest an additional $1.35 million in interior renovations at the Clay County property located at 198 Arora Blvd. in the southwest suburb of Orange Park. The site is about one mile south of Interstate 295 at Blanding Boulevard.

The Olympic-Heitman strategic alliance was formed to invest about $100 million in discretionary capital in class B and class C multifamily assets for a major Heitman institutional investor.

The local property is the fourth purchased by the alliance for the investor. The others are a $14 million property in West Palm Beach; a $20 million asset in Fort Myers; and a $20 million property in The Vinings submarket of Atlanta.

“The acquisition of the Oak Forest Apartments represents a unique opportunity for Olympic to acquire a class C apartment asset in an excellent location,’ says Brian Ward, Olympic’s executive director. “Comparable assets in the submarket support a material increase in rents, following completion of a planned renovation to the unit interiors and project common areas of about $5,000 per unit.”

Asked by GlobeSt.com why the alliance is investing in class B and class C properties instead of class A assets, Ward says the charter from Heitman’s client specified investments in B and C assets.

“This client was looking to place a portion of its allocated real estate capital into assets that had some sort of value added or turnaround component,” Ward tells GlobeSt.com. “The B and C classes of apartment assets have also proven to be incredibly resilient, particularly to the loss of tenants leaving to buy homes.”

Ward says the class B and class C apartment markets also “tend to have a much higher percentage of long-term renters, whereas the A market is catering more to the transitional period between renting and buying.” He adds, “The acquisition of assets with a value-added component or repositioning opportunity is a strength of the Olympic organization.”

Average in-place rents at Oak Forest Apartments are about 65 cents per sf, or $580 per month, and average living area in the units is 904 sf.

Ward says the alliance selected Jacksonville because the north Florida market “has continued to show excellent job growth and compelling investment opportunities throughout the multifamily sector, which we believe will translate into excellent returns for our capital partners over the investment term.”

Olympic Investors LLC is an affiliated entity of American Management Services, doing business as Pinnacle.

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