(Read more on the multifamily market.)
LAS VEGAS-Vested Housing Group of Phoenix and Principal Real Estate Investors have partnered to acquire a 16-acre site in Henderson that is approved for a 350-unit apartment community. Phoenix-based Vested Housing entitled the site for the project prior to closing the transaction. The purchase price was $10.5 million or $32.30 per rentable sf that will be developed.
Andy Miller, who started Vested Housing in 2005 but has been developing in Las Vegas since 1993, tells GlobeSt.com that construction is slated to begin in the second quarter of 2008 and last 20 months. Wachovia provided acquisition and pre-development financing.
The development site is located on the north side of Wigwam Parkway, just east of Stephanie Street, an intersection around which lots of development is underway including retail, for-sale residential and medical office space. Vested's project, called Henderson Lofts, will include a clubhouse, pool and fitness center, among other things. Unit features include 10-foot ceilings, granite countertops and tuck-under garages.
Given the market's perpetually low vacancy rate in apartments and an expected influx of workers to construct some 50,000 new hotel rooms over the next four years, Miller likes his chances of success. "With the amount of commercial construction [scheduled and under way], the expected job formation over the next three to four years is unprecedented," Miller says. "We're projecting rents will grow 5% per annum over the next several years."
If the project were ready to rent today, Miller says he would expect to achieve a rent in the vicinity of $1.20 per sf. Given Miller's rent growth prediction, the rents for his project when it's completed will be in the vicinity of $150 per sf.
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