TAMPA, FL-Baywater Apartments, a 176-unit property with 140,800 rentable square feet, has sold for $8.75 million. Located at 6910 W. Waters Ave., the class B 1985 property yielded $49,716 a door.
Franklin Street’s Managing Directors Darron Kattan and Bob Goldfinger, along with Director Kevin Kelleher, represented the seller, Merecorp, Inc. The buyer was a private local owner looking to increase current holdings both in size and quality. The property was approximately 93% occupied at the time of sale.
“This is a typical deal,” Goldfinger tells GlobeSt.com. “Demand for b quality assets continues to be very strong. The seller repositioned the property in a little over one year and found a buyer to assume the loan that had an onerous prepayment penalty.”
Baywater Apartments is a garden-style community with 17 two-story residential buildings. The unit mix offers one-bedroom and two-bedroom floor plans. The multifamily community is in Tampa’s Town and County submarket. The property is located in close great shopping, restaurants and the Veterans Expressway, which provides access to much of the greater Hillsborough County area.
Goldfinger says the seller made the deal attractive by investing “significant dollars” into long overdue renovations. Merecorp’s timing was impeccable, he continues, as along with the renovations and rental stabilization, cap rates in Tampa Bay continued to compress. Goldfinger says the buyer has acquired a stable property, in great condition, in a solid submarket that has improved over the last 10 years.
Demand generated by newly employed residents helped push down vacancy 210 basis points to 8.6% in the first three quarters of 2010, according to Marcus & Millichap. During the third quarter, the rate fell 120 basis points, following a 30 basis point drop in the preceding period. M&M expects the vacancy rate will decline 220 basis points in 2010 to 8.5%. In 2009, vacancy jumped 200 basis points.
“The last quarter of 2010 had strong velocity with numerous closings,” Goldfinger says. “We expect to see a continued improvement of deal flow through 2011. I would not expect as many closings in the first quarter of 2011 as the fourth quarter of 2010, but the market may continue to surprise us as we are seeing tremendous interest and demand.”
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