March 2015 E-Newsletter
What's New in the FAA
What's New Around the State
What's New Nationally
What's New in the FAA
More than three dozen FAA members from Florida traveled to Washington, D.C., last week to take part in the annual Capitol Conference and enjoy a day of grassroots lobbying on Capitol Hill. FAA had appointments with the offices of both U.S. senators from Florida as well as 26 U.S. representatives. Our members discussed our top federal priorities: immigration reform to allow greater guest workers in the construction industry, corporate tax reform, and Section 8 housing reform to lessen the regulatory burdens placed on apartment communities that participate in the voluntary federal housing program.
FAA members were also treated to a private dinner at the Florida House on Capitol Hill with special guest Congressman John Mica (R-Orlando).
Just three weeks into the 2015 legislative session that began on March 3, the FAA has seen two legislative victories: one for affordable housing and one regarding fair housing complaints.
Protecting the dedicated revenue source for Florida’s affordable housing programs is one of FAA’s main legislative priorities for 2015. Voter approval of state constitutional Amendment One in November, which calls for using a portion of documentary stamp funds for environmental programs, potentially threatened funding for housing programs, which also comes from doc stamps.
A Senate bill on Amendment One implementation, SB 586, has been amended to protect all affordable housing monies. When affordable housing is properly funded, it stimulates Florida's economy, creating $3 billion in positive economic impact annually by creating jobs. Additionally, keeping affordable housing funded decreases the need for inclusionary zoning.
A recent news report on WFTV focused on the need for affordable housing in Central Florida, and quoted Courtney Barnard, FAA’s government affairs director. Barnard expressed the FAA’s concern about the effects on affordable housing if funds were diverted to environmental programs.
In a second legislative victory for FAA and its members, potentially damaging language has been removed from House Bill 439 by Rep. Eric Eisnaugle. The bill would have changed the process for filing a fair housing complaint and would have allowed residents to seek litigation before using any administrative remedies. This bill would have put those who operate rental units at greater risk of being drawn into a civil suit regarding fair housing by negating administrative remedies.
The FAA is also working for expansion of the repairs that can be legally performed by maintenance professionals. The priorities were selected by FAA members at the Legislative Platform meeting in December, and in February more than 150 FAA members from across Florida gathered in Tallahassee to present our issues to legislators.
FAA will continue throughout the legislative session to monitor legislative activity and work with lawmakers to advocate for our industry and to fight proposed legislation that could be harmful.
If you have any questions or concerns, please email Courtney Barnard, FAA government affairs director at Courtney@faahq.org.
What's New Around the State
Blue Rock Partners and Konover South Continue Buying Spree with 4th Orlando-Area Apartment Community in 8 Months
Tampa-based Blue Rock Partners LLC, in partnership with Konover South LLC, Deerfield Beach, continued its buying spree in March with the closing of its fourth Orlando-area apartment community in eight months, growing its nine local holdings to nearly 3,000 apartments, the companies announced March 30.
With its $22.5 million purchase of the 238-unit Hunter’s Ridge Apartments at 3733 N. Goldenrod Road, Winter Park, Blue Rock now owns more than 2,200 Orlando-area apartments in partnership with Konover South. Representing a price per apartment of $94,538, the purchase is the latest of the partnership’s eight Florida acquisitions in the past year totaling nearly 2,000 apartments. "With 14 Florida acquisitions in the past two years totaling some 4,000 units, our partnership has now grown our Florida holdings to 8,000 units," said Randy Ferreira, CPM, principal/owner of Blue Rock Partners. Ferreira added that the partnership’s Florida portfolio in Orlando, Lakeland, Tampa Bay, and Fort Myers has doubled since January 2013. "Our Blue Rock Partners-Konover South partnership expects this to be one of many acquisitions in 2015," Ferreira said. "This past year," he added, "Blue Rock Partners collectively has acquired over 20 multifamily properties in three states with our various partners."
Ferreira said the partnership will invest $2 million in interior and exterior upgrades, and will re-brand and market the community as The Park at Napoli. The improvements will include a state-of-the-art fitness center, Internet café, and landscaping, plus all apartments will be upgraded with washers, dryers and new kitchen cabinets, counters, flooring, and lighting. Michael Donaldson of Marcus & Millichap, Tampa, brokered the transaction on behalf of the seller, Ebenezer Holdings Corp., Toronto. Wells Fargo provided acquisition financing for the transaction. The property had an occupancy rate of 95 percent at closing.
For details, visit www.bluerockpartnersllc.com or www.konoversouth.com.
Chicago Company Purchases 212-Home Garden-Style Apartment Community Chicago near Orlando’s Baldwin Park Neighborhood
Promenade Crossing, a 212-home garden-style apartment community in the Baldwin Park area of Orlando has been purchased by Waterton Associates LLC, the second Florida acquisition and sixth overall for the Chicago-based real estate investor and operator. The company spent $27.4 million, or about $129,009 per apartment. Waterton owns more than 2,300 apartments in five other rental communities in Florida.
"The Orlando apartment market has continued to benefit from high occupancies and steady rent growth, which makes it extremely attractive from an investment standpoint," said Max Peek, senior vice president of acquisitions at Waterton Associates. "While some of this activity has been fueled by former homeowners who became renters during the downturn, we’ve seen a societal shift in how everyone from millennials to baby boomers view housing, with many opting for the flexible, maintenance-free rental lifestyle afforded by communities like Promenade Crossing."
Promenade Crossing is a mix of one-, two- and three-bedroom apartments on Maguire Boulevard about three miles northeast of downtown Orlando. Seven floor plans ranging from 695 to 1,326 square feet are available, and each of the two- and three-bedroom units includes two bathrooms. All units are equipped with washers and dryers, ceiling fans, walk-in closets, and private balconies. Select apartments also feature solariums and French doors. Common amenities include a resort-style pool with a sun deck, a 24-hour gym, a clubhouse, a dog park, a car wash, and picnic areas.
According to a statement, Waterton is reviewing renovation plans for individual residences, common areas and amenity spaces.
Founded in 1995, Waterton manages $3.8 billion in assets on behalf of institutional investors, family offices and financial institutions. The company’s portfolio includes 12 hotels and 18,000 multifamily units.
The Irvine, Calif.-based seller, Passco Promenade Crossing DST, had bought the complex in 2009 for $20.8 million.
Study: Rental Boom is Boon to Orlando Economy, Contributing $5.8 Billion Locally in 2013
Demographic Changes, Growing Millennial Population, Rediscovery of Urban Cores Credited for Increasing Appeal of Apartment Living
The apartment industry emerged as one of the strongest sectors coming out of the Great Recession, and a new study shows just how much the Orlando economy benefited from the rental boom. In 2013 — the latest numbers available — apartment construction, operations and resident spending contributed $5.8 billion locally and supported more than 57,800 jobs in the metro area.
The economic data are part of new research commissioned by the National Multifamily Housing Council (NMHC) and the National Apartment Association (NAA), which looks at dollars and jobs from apartment construction, operations and resident spending, nationally, by state and in 40 specific metro areas, including Orlando. The data, based on research by economist Stephen S. Fuller, Ph.D., of George Mason University’s Center for Regional Analysis, are available on the website www.WeAreApartments.org.
180 Apartments to Be Part of New $75 Million Senior Living and Health Campus
Dr. Phillips Inc. is partnering with Harbor Retirement Associates and Orlando Health on a new $75 million senior housing and health care community on 26 acres in southwest Orange County.
The 180-apartment Spring Lake Health & Living Campus in the Dr. Phillips neighborhood will be developed and operated by the Vero Beach-based Harbor Retirement Associates.
The community will include 80 independent living apartments, 70 assisted living apartments and 30 memory care apartments, as well as full-service dining, 24-hour staff, scheduled daily transportation, and housekeeping and laundry services.
The community will include a 60,000-square-foot medical with primary care physicians and specialists, scheduled to open in 2016, ahead of the 2017 target for completion of the first apartments.
"This is an important project for Dr. Phillips," said Kenneth Robinson, president of Dr. Phillips Charities. "We are committed to sustaining the sense of community that has been built here since Dr. P. Phillips arrived here in the early 1900s."
Watercrest Senior Living Group Breaks Ground for 89-Apartment Pelican Landing Assisted Living and Memory Care in Sebastian
Watercrest Senior Living Group joined Walker & Company construction, MBV Engineering, and Sebastian city officials to celebrate the March 12 groundbreaking of Pelican Landing Assisted Living and Memory Care in Sebastian, Florida. Watercrest Senior Living Group, the developer, owner, and operator of the 65,000 square foot, 89-apartment senior living community, plans to open the building to residents in the spring of 2016.
Pelican Landing Assisted Living and Memory Care will feature 63 assisted living and 26 memory care apartments in a planned senior living community in the heart of Sebastian at 13085 U.S. Highway 1. The neighboring area offers diverse workspaces, retail and entertainment centers, residential neighborhoods, the Sebastian River Medical Center, and a riverfront district with unobstructed views of the Intracoastal Waterway.
"We are thankful to the city of Sebastian and the community for their support and enthusiasm for this project. Today, by working together, we have reached a development milestone. Collectively, we look forward to providing seniors of Sebastian the outstanding care and services needed in their local community," says Marc Vorkapich, principal and CEO of Watercrest Senior Living Group.
2 Orlando apartment complexes sell for $51.7M
Two Orlando communities totaling 576 apartments recently sold for $51.7 million.
Oakwood Apartments: Avanath Oakwood LLC of Irvine, Calif., purchased from Karlin Oakwood LLC for $29.9 million; 304 apartments; $98,355 each; 4698 Emerald Forest Way, Orlando
Stonebridge Landings Apartments: Stonebridge Landings LLC of Brooklyn, N.Y., purchased from Stonebridge Landings II Ltd. for $21.8 million; 272 apartments; $80,147 each; 7603 Fort Desoto St.The complex was built in 1999 using the federal low-income housing tax credit program.
Hermitage Apartments Break Ground in St. Petersburg
A 348-home project announced nearly a year ago has broken ground. Allen Morris Co. broke ground on the Hermitage, 750 First Ave. South earlier this month. The eight-story Hermitage will include studio, one- and two-bedroom apartments and will feature a rooftop pool. The $70 million project — more than $200,000 per unit — is backed by AIG Global Real Estate. When the project was announced last April, construction costs were estimated at $65 million.
Investor buys student housing near USF, plans renovations
Equity Management Partners Inc. of Tampa has acquired the Boardwalk at Morris Bridge Road, a 580-bed student housing development on Fowler Avenue just west of Interstate 75. The group paid $17.2 million.
Preferred Apartment Communities to Acquire 237-Unit Multifamily Community
Preferred Apartment Communities has signed a contract to acquire the Venue at Lakewood Ranch, a 237-home multifamily community, located in Sarasota, for an aggregate purchase price of approximately $47.4 million, exclusive of acquisition- and financing-related transaction costs. The company expects to complete the acquisition in May.
Atlanta Firm Buys Delray Beach Community
Pollack Shores Real Estate Group (PSREG) has acquired The Vinings at Delray Beach, a 228-unit apartment property in Delray Beach, in South Florida. According to the company, the purchase brings its current Florida portfolio to over 4,000 units.
Built in 1996, Vinings is a resort-style property not far from Downtown Delray. It includes one-, two-, and three-bedroom apartments, with a number of common amenities: a resort-style pool, outdoor grills, volleyball court, fitness center, and business center.
Atlanta-based PSREG plans to invest an unspecified but "significant" amount of capital to upgrade the apartment interiors as well as the property’s clubhouse, fitness center and pool area.
Matrix Residential, the multifamily management division of Pollack Shores, will manage the property.
ARA Newmark’s executive managing directors Avery Klann and Hampton Beebe, along with vice chairmen Dick Donnellan and Marc deBaptiste, represented the seller in the deal.