One of W.P. Carey’s managed non-traded REITs, CPA®:18 – Global, recently acquired a 97% interest in two multifamily properties in suburban Atlanta, Georgia. The two properties are Dupont Place Apartments in Tucker, GA and Gentry’s Walk in Chamblee, GA.
The total purchase price for the two properties was $46 million. Co-investors who own the remaining interest are Silverpeak Real Estate Partners and Carroll Organization.
The properties will be managed by Carroll Organization, a fully-integrated multifamily management company headquartered in Atlanta.
W. P. Carey’s Co-head of Global Investments, Gino Sabatini, commented, “These investments represented an opportunity to secure assets with strong in-place cash flow and the potential to enhance future returns through targeted capital improvements and the installation of a professional local asset management team. The transactions are consistent with CPA®:18 – Global’s strategy of acquiring income-generating assets, backed by solid real estate, with significant value-add opportunities.”
Both properties are located near Atlanta with Tucker being 3 miles east of I-285 and approximately 11 miles northeast of Midtown Atlanta while Chamblee sits inside the I-285 loop and is approximately 10 miles northeast of Midtown Atlanta. Both properties are close to Northlake, Perimeter Center, and Buckhead, which are major office submarkets.
Mr. Sabatini continued, “Additionally, these transactions allowed us to apply our underwriting and asset management capabilities to the multifamily sector. Both investments are examples of how we are well positioned to access a wider pool of opportunities which meet our established investment criteria and provide strong risk-adjusted returns to CPA®:18 – Global’s investors.”
Atlanta boasts a strong market with strong demographics. As of June 2014, its Class-A multifamily vacancy rate was 4.3% and its rental rates are expected to increase by approximately 2.9% per year over the next 5 years. In addition, Atlanta was the 4th fastest growing city by population in the U.S. over the last five years and had a 2.6% annual employment growth.