Wick tells GlobeSt.com that Base Capital is currently constructing about 1,000 apartment units in a total of six projects (Lynwood, South Everett, Mill Creek, Bainbridge Island, Covington and Puyallup) and he expects there to be no problem with occupancy.
"We just finished one private placement through Seattle Northwest Securities for $17 million," Wick offers. "And, out of 168 units we're only been running two to five vacancies per month." This apartment complex in Lynwood (known as Wood Creek), says Wick, has not been impacted (at least, not yet) by Boeing layoffs—although he admits the firm's membership was more than a little nervous when the layoff announcements came.
"We started another project up there about a year ago," Wick says, "it's also about 160 units, and we've been building eight units to a pad and getting them leased up within 30 days of the certificates of occupancy."
"We're close to Payne Field. Maybe our properties just aren't for the typical Boeing worker," Wick quips. "This isn't as dramatic as say, 1969 or '70 when one out of every eight or nine people worked at Boeing. We're finding that the impact (of Boeing layoffs) just hasn't been that great."
Base Capital often uses the vehicle of private placement offerings to raise cash for its projects—as well as for others. "From the investment standpoint it's a good time to be involved in real estate—because rates are so low for one thing," Wick notes. He then advises, "People should be acquiring property now and placing their permanent financing. We're still looking at CAP rates below 8.25%."
That's the good news, Wick tells GlobeSt.com. "The bad news is that we're not seeing a lot of movement or commitments—people just aren't fired up about writing big checks right now."
Wick speculates that some investors may be hoping their battered stock portfolios will come roaring back. "A lot of people still have most of their money in equity positions, and they may be reticent to get out—afraid to sell those stocks that have dropped 20% to 50% in case they run up."
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