ATLANTA-Lane Co., a locally based, multi-phased apartment development company, has purchased two high-profile multifamily assets totaling 808 units in the prime Perimeter Center of the city for $89 million, or $110,149 per unit.
A joint venture of Goldman Sachs' Whitehall Fund and Korman Communities sold the 90%-leased properties in a deal that Marcus & Millichap broker John Brown calls “the largest apartment transaction in Atlanta this year.” He says the properties are “irreplaceable real estate.” Brown represented the seller.
The 412-unit, seven-year-old Mt. Vernon Place Apartments is at 1265 Mt. Vernon Highway in suburban Dunwoody. The 396-unit, four-year-old Dunwoody Place Apartments is at 6850 Peachtree-Dunwoody Road, also in Dunwoody. Average monthly rents at Dunwoody Place are $1,150; at Mt. Vernon Place, $1,100. Lane Management Corp., a Lane Co. subsidiary, will manage the newly acquired communities.
“In the low $100,000-per-unit range, we believe our purchase price is well below today's replacement cost, especially given the average unit size of over 1,100 sf,” says Scott Levitt, vice president of acquisitions for Lane Investment & Development Corp. “There have been no true garden apartment projects developed since the late 1990s in the heart of the Perimeter Center area.”
He characterizes the properties as “two of the highest quality class A garden apartments in metro Atlanta in terms of location, floor plans, unit interior features and project amenities.”
Despite the slow economy, the Perimeter Center area is “attractive because of the high barriers to entry and the high quality employment in the area, Levitt says. “We feel the area should be poised to enjoy a strong recovery in the near future.”
Colliers Seeley International broker Herb Chase, who worked on the deal with Brown, says the metro apartment market is “at or near bottom and I believe Lane Co. will be rewarded for its excellent timing on the acquisition.”
In 2001, Lane acquired two other Perimeter Center communities, Glenridge Gables and Glenlake Gables, for $30.25 million. In March, Lane/Flagstone Ventures, a joint venture between Lane Co. and Flagstone Holdings, purchased Lexington Crossing I and II, a student housing community in Gainesville, FL.
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