Tropical Manor apartment complex in Merritt Island, FL
Earlier this year, a partnership comprised of The Bolour Movement, a privately-owned affordable housing acquisition and development company based in Los Angeles, and the Atlanta-based Triumph Management Group revealed a $5.1-million acquisition of the Tropical Manor apartment complex in Merritt Island, FL. GlobeSt.com recently chatted with Shawn Bolour, principal of the firm, on the state of affordable housing in the Orlando area and in the state of Florida, as well as the unique set of circumstances that were just right on this particular deal.
The 85-unit, Project-Based Section 8 affordable housing complex at 1165 Jordan Rd. is situated on an eight-acre site in the heart of Merritt Island. As part of the renovation plan, the complex will be renamed Coral Chase Apartments. According to Bolour, the partnership will create a secure and appealing living environment for current and new tenants at Coral Chase by investing approximately $2 million in upgrades. It has engaged Atlanta Financial Group to execute the rehabilitation and they will oversee extensive interior and exterior renovations, including new roofing and plumbing systems.
“Through this acquisition, our partnership protects these much-needed affordable units that could have otherwise been converted to market-rate housing. We were able to preserve and extend the affordability for an additional 20 years, and our acquisition will result in significant improvements to the property, both in terms of safety and infrastructure,” says Bolour, founder of The Bolour Movement.
He tells GlobeSt.com that Orlando is experiencing an unprecedented increase in market rate rental housing prices. “This increase adds pressure to local and state political decision makers to fund new affordable housing and preserve the existing stock,” he says.
He points out that a recent CBRE published study in November of 2018 showed that on market rate multifamily and ranked Orlando as the #1 Multifamily Investment Market in the Southeast. Orlando is in the 90th percentile for employment and population growth and 100th percentile for rent growth, he explained. The report also said that Florida has four of the Top 10 multifamily markets in the Southeast (Orlando, Jacksonville, Miami-Dade, and Tampa). Rent growth in Florida is higher than the US average.
What that means, according to Bolour, is that although Orlando's ranking is a good indication of the health of the real estate market, it poses real challenges for households who cannot afford to keep up. “Being ranked in the 100th percentile in rent growth means the rental rates are going up faster than any other market in the Southeast. Simply put, housing in Orlando is quickly becoming more unaffordable at unparalleled speed.”
He points out that the acquisition “ensures the preservation of a much needed affordable housing supply for the local community for decades into the future.”
When asked about why investing $2-million for a $5-million project might still earn investment back, he noted that a combination of a unique set of circumstances allowed them to purchase at the right price. “In particular, the property requires a lot of rehabilitation, providing a value-add opportunity.”
Coral Chase Apartments is located across from an elementary school and within walking distance to a high school, grocery stores and other retailers. The property has the capacity for the partnership to develop an additional 200 affordable units, which will be explored in the coming years.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
