WASHINGTON, DC—It wasn't exactly the plan but over the past five months Gaithersburg, MD-based Ideal Realty Group has closed three affordable housing deals the Washington DC area. Now, the company is getting set to market what will be its fourth transaction, this time in DC's Ward 8 submarket. What's more, the company's newly promoted president Cameron Manesh, tells GlobeSt.com that this property could actually trade at $100,000 per unit.
Some properties have been marketed at that price point, he said, but few, if any, apartments have actually closed there, at least in Ward 8.
Manesh thinks he has a shot with this new property, whose address he declined to disclose until marketing for the property begins, which will happen shortly.
If the sale does clock in at $100,000 per unit it will be in part due to the current rents, which are far below market rate, according to Manesh, who says that the apartment manager didn't realize that Section 8 units were not subject to rent control. “I think we can raise the rents by $300 per unit,” Manesh said.
Other than that “it is a beautiful, clean property,” he said.
In general there has been significant movement within Southeast and pricing per unit has been rising fairly quickly.
For example, the 100-unit Anacostia Gardens was one of the affordable deals that Ideal Realty closed this year. The process took a year because of TOBA, Manesh said. The buyer, NHP Foundation, met the full asking price of $8 million or $80,000 per unit. If the building had gone on the market today, it probably would have listed at $90,000 per unit, Manesh said.
WASHINGTON, DC—It wasn't exactly the plan but over the past five months Gaithersburg, MD-based Ideal Realty Group has closed three affordable housing deals the Washington DC area. Now, the company is getting set to market what will be its fourth transaction, this time in DC's Ward 8 submarket. What's more, the company's newly promoted president Cameron Manesh, tells GlobeSt.com that this property could actually trade at $100,000 per unit.
Some properties have been marketed at that price point, he said, but few, if any, apartments have actually closed there, at least in Ward 8.
Manesh thinks he has a shot with this new property, whose address he declined to disclose until marketing for the property begins, which will happen shortly.
If the sale does clock in at $100,000 per unit it will be in part due to the current rents, which are far below market rate, according to Manesh, who says that the apartment manager didn't realize that Section 8 units were not subject to rent control. “I think we can raise the rents by $300 per unit,” Manesh said.
Other than that “it is a beautiful, clean property,” he said.
In general there has been significant movement within Southeast and pricing per unit has been rising fairly quickly.
For example, the 100-unit Anacostia Gardens was one of the affordable deals that Ideal Realty closed this year. The process took a year because of TOBA, Manesh said. The buyer, NHP Foundation, met the full asking price of $8 million or $80,000 per unit. If the building had gone on the market today, it probably would have listed at $90,000 per unit, Manesh said.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
