(Read more on the multifamily market.)
BATON ROUGE-The sale of the Gates at Citiplace reportedly has achieved the highest price paid this year for a multifamily property in the city. The 369-unit complex has been sold for $41.5 million by locally based JTS Interest to a private buyer from Livermore, CA.
Matt Heininger, vice-president of the Austin office of Apartment Realty Advisors, who represented the seller, believes the $112,466 price per unit for the 2500 Gates Circle asset is also the highest rate ever paid in the city for a residential property not intended for condominium conversion. "We had tons of interest," he tells GlobeSt.com. "We had well into the double digits in terms of the number of offers. Gates is a very well located asset. It's in an in-fill location with very strong retail adjacent to the property." The buyer of record is AVR Gates Properties LLC.
The sale was a 1031 exchange, but Heininger says TIC buyers and investment groups, backed by institutional money, also made runs at the property. "Initially, the market was skeptical of such a large price-per-door in Baton Rouge," he says. "But, we brought a number of national buyers to the table, creating a very competitive bidding process with multiple offers of more than $112,500 per unit."
Baton Rouge's population swelled immediately after Hurricane Katrina and the repercussions are still being felt. According to Heininger, the market has seen a sharp increase in occupancy and rental rates have risen more than 12% in the two years since the storm. Although many of the 250,000 or so people who relocated to the area subsequently moved on, Heininger says most forecasters expect about 50,000 have remained as permanent residents.
The 89%-leased complex, built in 1996, has one-, two- and three-bedroom units ranging from 840 sf to 1,681 sf. Rents run from $990 to $1,999 per month and average $1.22 per sf. The property encompasses 16 residential buildings and one office structure on 27.1 acres, with about 13.6 units per acre.
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