Avanath Capital Management has acquired three affordable housing developments, adding 290 units to its existing portfolio of more than 10,000 units across the nation.
The latest acquisitions involve two communities in Detroit and another in Orange City, Florida.
“As a leading investor in affordable housing communities in key markets throughout the country, Avanath is adept at identifying opportunities to provide much-needed affordable housing and improving performance of those properties via our proven strategy,” says Daryl Carter, founder and CEO of Avanath Capital Management. “The Detroit and Orlando markets align well with our approach, which includes selecting markets and specific locations that share strong demographic trends relative to job/population growth, are near employment and transportation centers, and have barriers to developing new supply.”
The firm has properties in both markets, so the latest acquisitions will allow it to leverage economies of scale in order to better serve residents and generate strong returns for investors, Carter says.
In Detroit, Avanath has purchased the 50-unit North End Village for $2.1 million.
“As a native of Detroit, I’m excited to invest in my hometown,” Carter says. “In fact, this property is not too far from my high school. There has been a noticeable revitalization in the city of Detroit in recent years, spurred on by investment activity, new developments, and other social programs. Amazon recently announced the development of a new 3.8 million-square-foot distribution center in the city that will add 1,200 total jobs to the area. The city has worked to increase its manufacturing, logistics, health care, trade, tourism, finance, and technology sectors. In addition, tremendous capital investment into the automobile sector is restoring what was, at one time, Detroit’s sole economic driver.”
Built in 2005, North End Village is 100% occupied and consists of four two-story structures totaling 56,238 square feet. The development has 34 two- and 16 three-bedroom apartments.
Avanath is planning improvements to the property, including the addition of LED lighting, landscaping, exterior paint, balcony repair, and asphalt and parking repairs.
The firm also acquired Cameron Court, a 48-unit affordable seniors community, for $1.34 million. It is across the street from North End Village. Built in 2008, the property is 100% occupied and consists of one three-story structure totaling 38,784 square feet. The unit mix includes 18 one- and 30 two-bedroom units.
Avanath plans to implement a series of renovations, including hallway painting, exterior fencing and repainting, new common-area furniture, a community room renovation, and the construction of a new senior wellness center.
The firm also announced buying the 192-unit Saxon Trace Apartments in Orange City for $24.6 million.
Located approximately 30 miles from Orlando, Saxon Trace was attractive to Avanath because the firm was able to purchase it at a low basis in a market that has boomed over the last 10 years, according to Carter. The company owns four other properties in the Orlando market.
“Saxon Trace is also located in the heart of the retail and commercial corridor of Orange City, which provides this asset with a competitive locational advantage over other multifamily developments in the area,” says Carter.
The property has maintained at least 98% occupancy over the last three years due to the lack of competition of affordable housing in the area.
Avanath plans to implement a capital improvement plan to the property that includes a new roof, HVAC replacements, and exterior paint.