Denver, CO – Oak Coast Properties recently announced the $129 million acquisition of the Pembrooke on the Green Apartments in Denver, Colorado. Boasting an irreplaceable location in the southeast quadrant of the city, which is experiencing record population growth, the acquisition offers significant upside potential via a value-add investment strategy. Oak Coast Properties has earmarked the rental community for $1.9 million in capital improvements to commence immediately. HFF provided a $103 million loan to Oak Coast Properties for the acquisition.
“This acquisition marks our firm’s largest to date and brings our Denver portfolio to more than 2,300 units,” said Phillip Nahas, Oak Coast Properties’ Co-Founder and Managing Partner. “Having acquired and amassed a portfolio with a valuation of nearly a billion dollars and with the continued strategic alliances we have with our capital partners, we are committed to achieving above market risk adjusted returns through our investment strategy in Denver and other strategic markets across the country.”
The Pembrooke on the Green asset showcases Oak Coast Properties’ bullishness on multifamily investment in the greater Denver metro region. With more than 50,000 new residents moving into the Denver market annually, and for-sale new home construction still lagging, rental demand continues to push upward. Yearly demand for rental units is an expected 17,000 apartments, while new rental unit projections in both 2016 and 2017 anticipate only 14,000 new units coming to market.
“Denver’s growing population is putting significant pressure on the housing market, with new unit deliveries unable to keep up,” added Nahas. “Positive employment growth combined with these forceful market dynamics provides a ripe opportunity to drive returns through the upgrade of existing apartment assets such as Pembrooke on the Green.”
Originally built during 1974 – 1980, Pembrooke on the Green boasts a current occupancy of 95 percent. The community includes 959 apartments set within 37 three-story buildings and offered as a mix of studios, one-bedroom and two-bedroom units. In-unit amenities include central air conditioning, fireplaces, walk-in closets, cable TV hookups, garbage disposals and frost free refrigerators. Brushed nickel fixtures, ceiling fans, skylights, and vaulted ceilings adorn select units. Robust community offerings include a barbeque and picnic area, business center, carports, two clubhouses, community kitchen, dog park, fitness center, two heated swimming pools, sauna, laundry rooms, playground, soccer field, splash park and walking path.
The renovation of Pembrooke on the Green will include extensive upgrades to landscaping and outdoor furniture; parking lot, concrete and stair repairs; roof and gutter repairs; steel fixes; exterior upgrades including to the leasing office, pool, clubhouses and laundry rooms; mechanical work including electrical and plumbing work.
“Our capital improvements to the community, along with improved property management and oversight, will allow us to bring rents in-line with similar market rate properties in the region and drive additional ROI,” said Nahas. This asset continues OCP’s tradition of identifying, acquiring and adding value to superior assets acquired with conservative underwriting and superior management and producing above market risk-adjusted returns for our investors”.
Miami-based Pensam Residential provided a portion of the equity financing. BLDG Management, the Denver-based real estate management company, will manage the community.
Photo courtesy of Oak Coast Properties
