Archive for July, 2012

Homes Selling at Less Than Assessed Value in 66 Out of 100 NC Counties

Homes are selling at prices lower than their assessed values in 66 out of 100 NC counties, including every county in the Triad besides Guilford County, which just went through a reassessment last year. What that means is that any county going through a revaluation will likely have to raise tax rates to stay revenue neutral. From a Triad Business Journal story on the issue:

In “normal” times following revaluations, with tax bases growing by 20 percent or more, counties are able to cut the tax rates they impose, in so-called “revenue neutral” actions.

Some 13 N.C. counties revalued last year. In nine of those cases, the new “revenue neutral” tax rate was higher than the previous rate due to eroding property values. Counties in which that happened included Cabarrus, Guilford and Pitt.

“Counties and towns that experience shrinking tax bases will need to dramatically reduce their expenses or raise tax rates to account for the lost revenue,” McLaughlin said. “Case in point: Carteret County raised its property tax rate by 30 percent last year in recognition of its new, smaller tax base.”

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July 30, 2012 at 9:34 pm Leave a comment

Cap Rates Decline

A small item in the July 25, 2012 Wall Street Journal noted that the average cap rates for apartments declined from 6.27% in April to 6.12% in May. For comparison, cap rates for office buildings fell from 7.48% in April to 7.07% in May.

July 25, 2012 at 2:52 pm Leave a comment

Colmar Contracting to Build Oaks at Tenth in Winston-Salem

The Housing Authority of Winston-Salem has selected Colmar Contracting to build its 50-unit Oaks at Tenth project in Winston-Salem. From the Triad Business Journal:

The development is the first phase of the Cleveland Avenue initiative that is expected to eventually transform 130 acres over the next 15 to 20 years with a mix of retail, commercial and residential developments.

The Oaks at Tenth development will include 22 one-bedroom units, 22 two-bedroom units and six three-bedroom units at the corner of Cleveland Avenue and 10th Street on land formerly home to the Johnson Square Apartments. The project is expected to be completed by August 2013.

July 23, 2012 at 9:48 pm Leave a comment

54 Unit Senior Apartment Community Under Construction in High Point

From the Triad Business Journal:

Jamestown-based Wynnefield Properties has begun construction on Admiral Pointe, a 54-unit, 52,000-square-foot senior apartment development in High Point with a value of at least $5 million.

Admiral Pointe is one of several projects that Wynnefield Properties has planned for the Triad including Sunset Place, a 52-unit, $6.6 million apartment complex in Asheboro…

Admiral Pointe is located near the intersection of Wendover Avenue and Samet Drive and near a proposed Walmart Neighborhood Market in north High Point.

Admiral Pointe is being funded in part with about $1.2 million from the North Carolina Housing Finance Agency, which provided nearly $400,000 in federal housing credits. Those credits are sold to investors and used as equity for the project. The agency also provided an $800,000 loan for Admiral Pointe.

 

July 23, 2012 at 12:53 pm Leave a comment

Packaging Rent Payments for Sale as Securities

According to this article in the Wall Street Journal the newest game in real estate investing might be rent backed securities:

In recent months, firms such as Colony American Homes and Waypoint Homes have snapped up houses in foreclosure and rented them. Backed by investment banks and credit-rating firms, these firms think they have spotted a new opportunity: Packaging thousands of those rental payments into securities and selling them to other investors, a process known as securitization.

Potential issuers, like Colony and Waypoint, are seeking to create and sell these securities to tap outside investors for capital they in turn can use to expand their businesses.

They aim to entice investors with returns that could look even more alluring should interest rates remain at or near historic lows…

Just as the securitization of home mortgages before 2008 fed demand to originate more mortgages to pool into bonds, some bankers and potential issuers say creating bonds backed by rental payments could also stoke interest for more properties. Selling the bonds to investors would generate more capital for issuers to buy more foreclosed homes.

Such demand could reduce the oversupply of foreclosed homes in the market, helping to stabilize home prices, they say. There is also the possibility the market would not take off as issuers and bankers hope, making the impact of securitization negligible.

If these rental-backed securities do take off it will be interesting to see what effect they will have on the overall rental housing market, and what kind of opportunities open up for property management firms.

 

July 21, 2012 at 12:02 pm Leave a comment

132 Unit Community Planned for South Greensboro

From the Triad Business Journal:

Melos Investments U.S. Inc. is planning a development that calls for up to 132 apartments in southern Greensboro near I-85.

The development is planned for a 7.5-acre parcel located east of Belmont Street and north of Tolar Drive. It would be adjacent to a 216-unit apartment complex called Abernathy Park, which is managed by High Point-based Blue Ridge Cos.

When fully built out by summer 2013, Melos’ project will become the latest apartment development in the Triad, where developers continue to be bullish on the local rental market as many would-be buyers rent units amid tight lending requirements and higher unemployment.

July 20, 2012 at 5:34 pm Leave a comment

240 Apartments Planned as Part of Mixed Use Development on Horse Pen Creek Rd in Greensboro

According to the Triad Business Journal a new mixed-use development that will include 240 apartments is being proposed for Horse Pen Creek Rd in close proximity to the Plantation at Horse Pen Creek community:

A land development consulting business is planning a mixed-use project in northwest Greensboro that calls for as many as 240 apartments, up to 10,800 square feet of office space and a potential buildout of $20 million.

Brad Deaton, manager of Acquisition & Development Resources LLC, said the project will go up on a 12.8-acre site at 3320 Horse Pen Creek Road near Battleground Avenue and directly across the street from the 192-unit Plantation at Horse Pen Creek apartments.

July 20, 2012 at 2:24 pm Leave a comment

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