"It met a lot of people's investment criteria," says Patton Jones, managing director in Austin for Atlanta-based Apartment Realty Advisors. "We had more offers and more tours of any property we've had in Austin." Developed in 1993 by Gables Residential Trust of Atlanta, the 29-building complex on 23.7 acres at 11266 Taylor Draper Lane in the prestigious Arboretum is assessed at $22.89 million.
Gables had the asset marketed without an ask. Jones tells GlobeSt.com that Greystar made the close with cash and plans to sink another $10,000 per unit into the value-add play plus add an on-site fitness center "to bring it from a class B to a class A." Gables Great Hills, which will be renamed, was 93% leased at sale time.
"This is an area where demographics are excellent and lend themselves to a value-add program," Jones says. "It is expected they will be able to initiate rent bumps after a value-add program. They studied that and that's why they're here."
[IMGCAP(2)]The mix of one- and two-bedroom units average 829 square feet. The average monthly rent is $899. A comparably sized class A apartment would command about $1,000 per month in rent in the Northwest Hills submarket.
Greystar is doing a similar value add at the Estates on Quarry Lake, a 302-unit mix at 4600 Seton Center Pkwy., just one mile south of Gables Great Hills. The hands-on submarket experience and Greystar's track record for closing swung the deal its way, according to Jones, who says there was one offer higher than the Charleston, SC-based buyer's. "There was safety in picking Greystar as the buyer," he explains. "Greystar was our buyer from the start."
Gables Great Hills spans two hilltops and includes a 14-acre nature reserve in a market that collects rent premiums for apartments with views. The location also is within minutes of the Arboretum's office and retail developments. The ARA marketing team includes sales associate Casey Fry in Austin and principal David Oelfke in Houston.
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