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Starwood Capital Group
North Myrtle Beach
South Street Partners
North Beach Towers
real estate data
The US apartment sector is known to be outperforming on the US commercial scene, even after the recent pick-up across all sectors is taken into consideration. In fact, according to the latest commercial real estate data from CBRE, the apartment vacancy rate in the fourth quarter of last year stood at just over 5%, 70bps lower than Q4 2010 and based on a drop in 52 of the 60 markets tracked.
So, the reports that institutional investors are snapping up apartment blocks across the states come as no surprise. In fact, according to the latest reports where they can't buy blocks they are building new stock. Now, they are also buying developments and their debt liability.
A prime example came this week when Starwood Capital Group partnered with South Street Partners to purchase North Beach Towers, a 1 million square foot condominium complex in North Myrtle Beach, South Carolina. The partnership purchased the development packaged with its outstanding bank debt in an off-market transaction for "a significant discount" off its face value, according to a spokesperson.
The scheme "offers its residents the highest quality construction, interior unit finishes and amenities available in the market and is well-positioned for success going forward," said Mark Keatley, a senior vice president at Starwood Capital.
The development is currently being marketed by the Hoffman group, according to the firm's website prices on the development have been reduced to $333,000 from $529,000 for a 1 bedroom unit and to $1.12 million from $1.99 million for a 5 bed 4 bath unit. These prices seem high for the US, but the area is one of the best performing in the US and prices are comparable with other short sales in the area.
Sales have been strong, says Tim Horton, vice president of sales for the Hoffman Group, which is marketing the property. Of the 330 units on offer, 230 have been sold. "We're selling an average of 11 a month," he said.
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*This page is provided for information purposes only and should not be construed as offering advice. IPIN is not licensed to give financial advice and all information provided by IPIN regarding real estate should never be treated as specific advice or regulations. This is standard practice with property investment companies as the purchase of property as an investment is not regulated by the UK or other Financial Services Authorities.