Jon Bell Steps Up to CEO Role for Bell Partners

The Triad Business Journal has a nice article on Jon Bell’s ascension to the CEO role for the company his father founded 40 years ago.

After seven years as president of the apartment investment and management company his father founded in 1976, Jon Bell has moved up a rung and will begin serving as CEO on Feb. 1.

In that new role, Bell said he’s going to be more focused on the “big picture” and long-term growth of the company, while new President Lili Dunn will be more involved in the day-to-day operation of Greensboro-based Bell Partners.

“The CEO role is more strategic, more big picture, involved with guiding the organization,” Bell told me Wednesday. “We’ve had a lot of evolution at Bell Partners over the past five or 10 years. But we’re just getting started.”

That evolution has included shifting its focus exclusively to high-end multi-family residential complexes in growing markets, a change Bell Partners announced five years ago this month that included rebranding its communities with the Bell name.

You can read the full story here.

Signature Ready to Get Going in Burlington and Mebane

Signature Property Group, a longtime presence in the Greensboro apartment market, is ready to expand into other Triad markets:

Work should begin next month on a $32 million, 288-unit complex in Burlington around the same time work starts on a $30.2 million, 264-unit complex in Mebane.

Signature CEO Frank Auman said he’s excited to begin building in both cities, and the locations of each fit into a model he says has proved successful — within walking distance of amenities, and close to interstate access.

“We want to expand our presence outside the market,” Auman said. “My strategy is to first move toward the greater Raleigh area, so we’re kind of marching in that direction.”

As part of his explanation for why he sees potential in this sector of the apartment market, Auman was quoted as follows:

“Our rental demographic keeps expanding, especially in this rental class,” he said. “You’re as likely to get recently graduated college kids on their first job as you are to get retirees who are tired of mowing the grass and want to be more mobile.”

You can read the full story here.

Utah Company Expands Its Triad Footprint, Buys Two Greensboro Properties

RealSource, based in Salt Lake City, Utah, has purchased two apartment communities with a combined 448 units for a total of $27.7 million. The Triad Business Journal carried the story earlier this week:

Salt Lake City-based RealSource purchased Friendly Ridge Apartment Homes, a 216-unit complex on St. Croix Place, for $12.5 million and spent $15.2 million on The Park at Oak Ridge, a 232-unit complex on Old Oak Ridge Road…

RealSource plans to invest $3.25 million in upgrades and repairs at The Park at Oak Ridge, and to spend $2.5 million enhancing Friendly Ridge.

The bulk of that cost will be spent on upgrades, with a focus on interior improvements in the one-bedroom and two-bedroom units that make up each community, he said. Anderson said a contractor has not yet been selected for the work.

How To Save $150 On the 2016 NAA Education Conference

Every year the National Apartment Association’s Annual Education Conference & Exposition is the biggest apartment industry event in the country. In 2015 over 9,000 people attended the conference in Las Vegas, NV to hear keynote speaker Jay Leno, to attend any of the dozens of educational sessions, and to visit a trade show floor that featured over a thousand top-notch vendors. On June 15-18, 2016 the conference will be held in San Francisco and will feature keynote speaker Michael Strahan and will have literally dozens of education sessions (see a schedule here) that will benefit you and your team.

To help make the conference as “do-able” as possible for our members, PTAA has arranged a huge discount on registrations for our members. If you register through us your registration rate will be $575 which is a $150 savings from what it would cost to register on your own. That’s a savings of over 20%!

Also, if you’re a member of another NAA affiliate in North Carolina, South Carolina, Georgia, Tennessee or Kentucky you should check with your local affiliate to see if they are offering the discount. If not you’re more than welcome to register through us as well. If you’re not a member of any affiliate or of NAA directly you can still get $150 off the non-member rate.

We’re all set up to accept registrations, so if you would like to register through us simply fill out our registration form – 2016 NAA Education Conference NC Group Discount Registration Form – and email it to Jon Lowder. Once we receive your order and payment we will send you a unique registration code for each of your registrants. Once they have their codes each person will be able to fill out their information online and reserve their room at one of the 39 hotels NAA has reserved for the conference.

So don’t delay and take advantage of this remarkable deal and experience the greatest multifamily industry show on Earth!

 

Building Boom: Investors Still Bullish on Apartments

From the Wall Street Journal:

After six years of rising apartment rents in U.S. cities, investors from all corners of the real-estate industry are piling into new projects in a bet the boom still has a long way to run.

Over the next three years, developers are expected to build almost 1 million apartments in the U.S., more than the nearly 900,000 constructed over the previous three, according to researcher Axiometrics Inc.

In 2014, multifamily rental construction reached 328,000 units, its highest in nearly 30 years, according to an analysis of U.S. Census data by Jed Kolko, a senior fellow at the Terner Center for Housing Innovation at the University of California, Berkeley.

The main lure for investors: rising rents. Average rents nationwide rose 4.6% in 2015, the biggest gain since before the recession, according to real-estate researcher Reis Inc. Rents have increased by more than 20% since the beginning of 2010. Most economists expect 2016 to be another strong year. The average monthly U.S. apartment rent now stands at nearly $1,180, up from about $1,125 a year ago, according to Reis.

Yep, rents are up across the US, but the Triad is still affordable by comparison. According to Real Data’s latest report, average rent in the Triad was $760 in Sep, 2015 which was up from $728 a year earlier. Same could be said for comparing development in the Triad to the rest of the country: the Triad is definitely seeing some apartments built, but not at the same rate as many of the major metro areas.

The Residences @ the RJ Reynolds Building Set to Debut

The Winston-Salem Journal ran a front-page story in their Sunday edition yesterday about the imminent opening of the Residences @ the RJ Reynolds Building in Winston-Salem. Here are just a few tidbits:

The Residences @ the R.J. Reynolds Building expects to have its first dwellers “in legendary living” in early March, with the bulk moving in by late summer, said Chris Girard, a sales and marketing official with developer PMC Property Group.

PMC provided the Journal with a look at the renovations occurring on the seventh through 19th floors of the historic “Grand Old Lady.” Those include one- and two-bedroom apartment models, and social and recreational amenities that residents will share with guests in the Kimpton Cardinal Hotel…

There will be 20 units each on floors seven through 10, and six units each on floors 11 through 19 of the main tower. Because of superstitions of the time, there is no 13th floor.

Girard said 65 percent of the units will be one bedroom and 35 percent two bedrooms. Monthly rent starts at $995 for a one-bedroom unit and average $1,385 for a two-bedroom unit.

Click here to see a short video that accompanies the story.

 

Foreign Investor Part of Hawthorne at Bridford Purchase

A January 7, 2016 press release provides details about the recent sale of Hawthorne at Bridford:

Lowe Enterprises Investors (“LEI”), in joint venture with a foreign investment client, has acquired Hawthorne at Bridford, a 264‐unit Class A gated apartment community located at 598 Eagle Road in Greensboro, North Carolina.

“Hawthorne at Bridford is centrally located near the primary Greensboro employment corridor. Greensboro is a strong market that benefits from a diverse and expanding employment base. The property presents an opportunity to acquire a top quality asset in a strong and growing market,” said Bleecker P. Seaman, co-CEO of LEI.

The phased development of Hawthorne at Bridford began in 2012. The first two phases, containing 216 units, are currently 97 percent occupied. The final 48-unit phase was completed in December and is now actively leasing. The property is designed with 11 three-story residential buildings set on a 19.8 acre property…

John Gaghan led the investment team for Lowe Enterprises Investors. Greystar has been retained to manage Hawthorne at Bridford.

Blue Ridge Companies’ Approach to Health Insurance

Blue Ridge Companies decision to go its own way for employee health insurance coverage was profiled in the December, 2015 issue of Units Magazine. It’s a complex issue, but as Executive Vice President Susan Passmore explains in the article, it’s an increasingly important consideration for all management companies. Here are a few excerpts from the article:

Blue Ridge began its plan in May 2014 and currently 200 employees and 60 dependents are participating.

“You can convert fairly easily,” Passmore says. “In general, if you stick with the plan, over a five-year period, you will begin to see a trend that defines where your medical insurance dollars are being spent.”

Self-insured plans, she says, simply are not subject to all of the same regulations and fees as fully-insured programs. The result for us is approximately 3.5 percent less fees paid to the government.

Although self-funded plans have certain requirements, Passmore says her company is able to tailor a variety of services within each plan, based on her associates’ needs.

“No more are we at the mercy of fully-insured off-the-shelf design offerings,” she says. “By us reviewing and recognizing common claims usage, it allows us the flexibility to tweak the plan to fit the needs of our employees and reduce costs for our company.”

Blue Ridge uses a third-party administrator (TPA). And Passmore says large insurance company Cigna, which formerly administered her company’s plan, is still involved.

Blue Ridge outsources its TPA, who functions as a benefits manager and provides basically the same services as a traditional carrier…

Passmore says that most carriers, including Cigna, partner with the third-party administrators (TPA) to share their discounts.

“This allows health-care providers to file claims through the traditional carrier networks, and it allows us to benefit from the carriers’ negotiated pricing. The claims pass through the carriers’ pricing network and are then captured by the TPA and forwarded to us to pay.”…

“We need healthy associates to be successful so we certainly want them to seek care when they need care,” Passmore says. “Moving to a self-funded insurance plan really fits our company’s culture. One of our company’s tenets is ‘teamwork; appreciating self and others, having a balanced way of life and having fun together.’ Since our shift to this plan, our associates have become engaged in taking both individual and collective responsibility in the overall cost of health care.

“We know there will be accidents or conditions that result in really expensive claims. It’s inevitable. We have stop-loss coverage, which reimburses us for single-claim events that cost more than $50,000. Protection of stop-loss coverage is a must, and adding a separate organ transplant rider strengthens the protection against loss.”

You should definitely check out the full article here.

 

Five Triad Apartment Communities Start 2016 Under New Ownership

An article in the Triad Business Journal provides an overview of five apartment community sales in the Triad at the end of 2015:

Deerwood Crossing Apartments (Winston-Salem), now known as Twin City Apartments, is a 285-unit community that sold for $11.4 million.

Westgate Terrace Apartments (Winston-Salem), is a 42-unit community that sold for $2.53 million.

Ridgewood Apartments (Greensboro), a 14-building, 160-unit community sold for $5.4 million.

Tucker Street Apartments (Burlington), a 31 building community built in 1972 sold for $2.6 million.

Beaumont Avenue Apartments (Burlington), a 40 building community built in 1972 sold for $2.6 million.

More details about the transactions can be found here.

Winston-Salem Dishes an Assist for 115 Unit Apartment Development

The Winston-Salem City Council voted at it’s last meeting in December to provide financial assistance for a 115-unit apartment development:

An proposed 115-unit apartment project downtown received an assist from the city Monday when the Winston-Salem City Council approved $1.25 million in loan financing…

Laurel Street Residential LLC of Charlotte and Goler Community Development Corp. based here are teaming up to develop the site, which is on a dead-end section of North Chestnut Street just south of Martin Luther King Jr. Drive.

A key part of the plan is a provision for what is called affordable or workforce housing: Dwellings for households that make 80 percent of the average area median income.

The complex is planned to have 14 studio units, 83 one-bedroom units and 18 two-bedroom units.

Rents on the market-rate units will range from $1,045 to $1,445 a month. Rents will be lower on the affordable housing units: $757 a month for the studio units and $841 a month for 15 one-bedroom units…

The developers are agreeing to set aside 25 percent of the apartments for affordable housing during the first 10 years of the life of the development, and 15 percent of the apartments for a 20-year period after that.