Lack of Rent Control Hands Investors Interesting Opportunity
Vancouver represents a good value proposition for the greater Portland area renter along with lower housing costs, no state income taxes, good public schools, near PDX airport and Portland’s job center.
VANCOUVER, WA—Vista Investment Group continues its Portland, OR buying spree. Goldman Sachs Asset Management Private Real Estate’s joint venture with Vista recently acquired Green Leaf River Pointe, a 387-unit multifamily property located in the Vancouver, WA submarket of Portland, OR. The garden-style community is located northeast of downtown in east Vancouver, which provides a strong foundation of local employment and retail locations, as well as access to downtown and the Evergreen public school district.
“Vancouver represents a tremendous value proposition for the greater Portland area renter. Lower cost of housing, no state income taxes, good public schools; all while remaining in close proximity to PDX airport and the major employment center of downtown Portland. From the investor side, the lack of rent control also presents an interesting opportunity. For those reasons, we will continue to explore new investment opportunities in the market with Goldman Sachs Asset Management Private Real Estate,” Vista Investment Group president Jonathan Barach tells GlobeSt.com.
Given limitations of this statewide measure, it doesn’t seem the new rent controls create an immediate problem for Portland-area operators, according to a report by RealPage. Renewal rent growth here has been moderate recently, running below the national average. At the end of 2018, price growth for renewal leases reached 4.7%, well short of the 10.1% that would have been the cap if the rent controls had taken effect last year. Inflation was 3.1% at the end of 2018, says RealPage.
The partnership plans to improve the property through a unit renovation program that will include new flooring, upgraded lighting fixtures, stainless steel appliances, kitchen cabinets and countertops. The partnership also intends to modernize the clubhouse, improve the pool deck and add outdoor amenities.
“The Portland MSA is one of the largest growing labor markets in the country. Vancouver, WA has experienced high population, job and wage growth in recent history, and we believe the property will appeal to tenants in this community due to its location in east Vancouver with access to quality public schools and a diverse employer base,” said Joseph Sumberg, head of Goldman Sachs Asset Management Private Real Estate.
The property is Goldman Sachs Asset Management Private Real Estate’s 25th multifamily investment. The firm currently owns approximately 6,850 multifamily units across the country. The property is Vista’s second multifamily acquisition in Vancouver in the last 60 days, and represents the Los Angeles-based real estate investment firm’s sixth acquisition in the Portland MSA in the last 19 months.
“Vista is thrilled to be working in partnership with Goldman Sachs Asset Management Private Real Estate on this investment. Their commitment to the joint venture and this project in particular is a true value-add to the execution of our business plan. The combined operational expertise, market knowledge and execution capability should prove invaluable on this and future investments through the partnership,” said Michael Panich, director of investments at Vista Investment Group.