A joint venture between Hayman Co., and Belfor Holdings Inc., recently purchased two Michigan apartment complexes with a total of 1,022 units. The units, both one- and two-bedroom apartments, range from approximately 700 to 1,200 square feet. The two complexes part of the deal, The Pines of Cloverlane and Hamptons of Cloverlane, are both located between West Michigan Avenue and Interstate 94 in Ann Arbor and have 582 and 440 units, respectively.
The average monthly rent at the 1986-built Hamptons of Cloverlane is $1,003, and the average rent at The Pine of Cloverlane, built in 1976, is $793. Decently priced and with a occupancy rate around 96 percent, the two complexes are likely to be a sound real estate investment. The average rent in the city of Ann Arbor has been rising in recent years, currently at $1,038 in the first quarter of 2015. That’s up from the $994 reported in the second quarter of last year, according to CBRE Inc.
Hayman Co., reports that it is planning somewhere between $6 and $7 million worth of renovations to the complexes, including updates and improvements to both the units and the complexes’ landscaping and clubhouses. Those renovations may mean that the rent amounts will be raised for incoming tenants.
The sale price was not disclosed by the buyers, and the seller also refused to comment. If the complexes were sold around market value, however, the total price would be somewhere around $79.4 million based on the $77,760 average asking price per unit last year in Ann Arbor. According to the broker who handed the deal, it was the largest multifamily deal in the state so far in 2014, a sign of good things to come for the Michigan commercial real estate market.
Source: Crain’s Detroit Business, “Hayman-Belfor JV buys apartment complexes near Ann Arbor” Kirk Pinho, Apr. 24, 2014