TAMPA-Doral Oaks, a 252-unit apartment community next to the new Downtown Temple Terrace, has traded for $13.7 million. The property was constructed in 1967.
Cushman & Wakefield directors Byron Moger and Luis Elorza were the only brokers involved in the transaction. A private investor purchased the asset.
“Doral Oaks is adjacent to the redevelopment site underway for downtown Temple Terrace,” Moger tells GlobeSt.com. “When the redevelopment project is completed, Doral Oaks’ residents will benefit from the activities and amenities in the new downtown.”
The redevelopment project includes a 500,000 square foot master planned development. Totaling 267,170 square feet, the garden-style apartment community offers one-, two- and three-bedroom apartments. The property features gated access, two swimming pools and children’s play area.
“The prior owners replaced roofs, installed new air-conditioners, painted building exteriors and upgraded a large number of units,” Elorza said in a statement. “Doral Oaks is well positioned for additional investment that will continue to improve the desirability of the property.”
The class B and C multifamily sector accounted for more than 60% of positive net absorption in the first quarter, compared with less than half of absorption six months ago, according to Marcus & Millichap. Projected improvements in vacancy and rents will encourage developers, the firm says, but deliveries in 2011 will have a limited effect on operating results.
With the recovery under way in the class B and C segment and owners increasingly able to withdraw concessions, cap rates for this product type could compress from their current range of around 8%, M&M reports. Interest in lower-grade properties recovered over the past six months, and first-year returns of about 10% remain attractive.