Creating Value in Multifamily Assets

Transcription

1 Creating Value in Multifamily Assets Moderator: Speakers: Julie Smith, The Bozzuto Group Rohit Anand, AIA, NCARB, KTGY Allina Boohoff, JP Morgan Lili Dunn, Bell Partners, Inc.

2 Who Is Renting? Millennial 57% SG 3% Baby Boomer, 16% Gen X 24%

3 What Do Renters Care About? Source: Bozzuto Advisory Panel 2015

4 What Do Renters Want In Their Communities?, WHAT YOU LIKE ABOUT YOUR COMMUNITY Close/Proximity, Near are the most common words used, when talking Restaurants about what residents like about their community. It means convenience.. Access & Close Proximity To Public Places Shopping Public Transportation Night Life Events

5 What Do Renters Want In Their Buildings? Concierge Service On-site retail Fitness indoor and outdoor Package Delivery Lockers Pool and sundecks Outdoor cooking and entertaining Private entertaining spaces Complimentary Coffee Bars/Refreshments Social gathering space with great WiFi

6 What Do Renters Want In Their Homes? Stone Countertops Hard-surfaced floors Private balconies and terraces Large Closets Light/Volume/Windows No additional rent premiums

7 Design Trends Driving Multi- Family 10/20/2016

8 Luxury Redefined 10/20/2016

9 Rooftops Reimagined 10/20/2016

10 Private Outdoor Nooks 10/20/2016

11 Enticing pools 10/20/2016

12 Spaces that bring the outside in 10/20/2016

13 Calming water features 10/20/2016

14 Outdoor kitchens 10/20/2016

15 Interactive art 10/20/2016

16 Warm hospitality 10/20/2016

17 Collaboration spaces 10/20/2016

18 Communal kitchen & dining 10/20/2016

19 Niche fitness 10/20/2016

20 Local design integration 10/20/2016

21 Pet amenities 10/20/2016

22 10/20/2016 Corner store convenience

23 Membership benefits 10/20/2016

24 We Live 10/20/2016

25 Social apps to connect App screenshot from medium.com

26 Trends In Mixed-Use Design Mixed-Use Design that will be transformative Sky pools.

27 Anthem House Baltimore, MD 10/20/2016

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29 Anthem House Baltimore, MD 10/20/2016

30 One Santa Fe Los Angeles, CA 10/20/2016

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35 Mixed-Use Developments that Have Changed Neighborhoods 10/20/2016

36 The Fenway Apartments Boston, MA Fenway Neighborhood in 2004

37 The Fenway Apartments Boston, MA Fenway Neighborhood now

38 Fenway Park, Boston, MA 10/20/2016

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41 The Fenway Apartments Boston, MA Major rebranding started in 2001 Strategic location close to employment, transportation, and entertainment Next to Fenway Park New development has added 250,000 SF of retail, 1600 residential units, and 330,000 SF of office and clinical space Close proximity to Emerald Necklace, which is a historic, 6-mile park, spanning Boston and Brookline Close proximity to I-90 and I-93 as well as Green Line and bus routes Trended proforma rents are exactly in-line with reality about $4 PSF Exit cap rate was underwritten at 7.5%

42 Avalon Chrystie Place, Manhattan, NY 10/20/2016

43 Avalon Chrystie Place Lower East Side, NYC Site - Before Site - Before Site - After

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45 Avalon Chrystie Place Lower East Side, NYC Built in the path of gentrification Since 2000, crime (seven major felony offenses) is down 57% The Bowery was dubbed the new Millionaires Row in 2006 Whole Foods took residence in 2006 (lease signed in 2004) Subway ridership increased 48% per year from in 2007 Brand new hotels, restaurants, bars, clubs, museums, galleries and apartments are built in the area New joint venture with AVB Trended proforma rents at time of UW $67 PSF vs. $74 PSF actual rents in 2015 Exit cap was underwritten at 7% vs. 4% actual represents increased liquidity of the market and investors perspective of the future of the area Executed a sale in 2014

46 Monroe Street Market Washington, DC 10/20/2016

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51 Acquisitions That Have Added Value 10/20/2016

52 Bell Coconut Creek Property Name Bell Coconut Creek Investment Vehicle Bell Fund V Location Ft. Lauderdale, FL Year Built 1998 # Apartment homes 366 Product Type Garden Style Total Investment $61.2M Investment per Home $167,000 Date of Acquisition February 2014 Renovation budget $3,705,346

53 Bell Coconut Creek Bell Coconut Creek

54 Bell Coconut Creek BEFORE AFTER

55 Bell Coconut Creek BEFORE IN PROGRESS PLAN AFTER Move leasing to forefront of clubhouse Open up clubhouse to create a grand feel Create multiple cyber areas Create gaming and social areas Enhance design to appeal to target profile Expand fitness areas Create outdoor kitchen in picnic area

56 Bell Coconut Creek LEASED EFFECTIVE RENT $1,650 $1,600 $1, % increase $1,554 $1,500 $1,450 $1,400 $1,380 $1,350 $1,300 $1,250 July 2014 Rent Roll June 2016 Rent Roll

57 Bell Flatirons Property Name Bell Flatirons Location Denver, CO Year Built # Apartment 1,208 homes Product Type Total Investment Investment per Home Garden Style $284.1M $236,000 Date of Acquisition April 2015 Renovation budget $19,328,269

58 Bell Flatirons Investment highlights Proximity to major employment Resort style amenities Significant upside through value add Strong multifamily submarket Excellent access via major roadways Notable retail and entertainment next door Wide range of floor plans Excellent school options Bell Flatirons

59 Bell Flatirons Resort Style Amenities 10/20/2016

60 Bell Flatirons BEFORE AFTER

61 13 acre private lake 10/20/2016

62 Bell Flatirons LEASED EFFECTIVE RENT $1,650 $1,600 $1, % increase $1,572 $1,500 $1,450 $1,400 $1,405 $1,350 $1,300 $1,250 May 2015 Rent Roll July 2016 Rent Roll

63 A Capital Discussion Where are we in the cycle? How does this differ from the last cycle? What is capital seeking today? Where are the challenges in buying and building? What are the design challenges related to an evolving product type? Impact on strategy?

64 Q&A Thank you!