Colorado Real Estate Journal - January 21, 2015
A Denver-based multifamily investment and management firm is keeping true to its plans to be “always buying, always selling ” with its recent dispositions of a pair of Colorado Springs apartment properties. Griffis Residential sold the Sagebrook and The Oasis in separate trans actions to an unidentified Boulder-based buyer and Steadfast Apartment REIT, respectively, for $88.8 million. Sagebrook, located at 2555 Raywood View, sold for $48.8 million. The 314-unit, Class A community, constructed in 2001, features a mix of one-, two- and three-bedroom units in 15 three-story buildings. Apartments feature 9-foot ceilings, walk-in closets, full-size washers and dryers and covered patios or terraces. Community amenities at Sagebrook include a state-of-the-art fitness center, swimming pool, all-season spa, outdoor picnic area with gas barbecues, coffee bar, single-stream recycling program and a northeast Colorado Springs location. Additional details about the buyer and its plans were not disclosed. The Oasis, located at 1495 Farnham Point, sold for $40 million. The acquisition of the 252-unit community represents Steadfast Apartment REIT’s entry into Colorado. “We are excited to add The Oasis to our growing roster of apartment communities,” said Ella Shaw Neyland, president of Steadfast Apartment REIT. “We believe this property is well positioned in a market experiencing midwage job growth that is much stronger than the U.S. average and has limited new apartment construction.” Built in 1997 on approximately 15 acres, The Oasis boasts 16 two- and three-story garden style buildings with one- and two-bedroom units with average in-place rents of $1,102. Apartments include central air conditioning, balconies or patios, washers and dryers, walk-in closets, fireplaces and attached garages in select units. As of Dec. 1, occupancy was 96 percent. The Oasis also features a clubhouse and leasing office, fitness center, swimming pool, hot tub and business center. Steadfast plans to initiate a modest revitalization program at the northwest Colorado Springs community as part of its value enhancement strategy that will include granite counter tops, upgraded appliances and cabinets, vinyl wood floor and faux wood blinds in select apartments. Steadfast will complete the interior upgrades as units turn over. CBRE’s David Potarf, Dan Woodward, Matt Barnett and Jake Young handled the transaction. “It is one of the nicest 1990s communities in Colorado Springs,” said Woodward. “It has a really good location that is hard to replicate. It also has everything you want, attached, direct-access garages, nice floor plans and great views.” Both properties’ sales prices reflect more than $10 million increases in value since Griffis Residential acquired the properties with its first fund. The sales price of Sagebrook reflects an appreciation of $12.6 million from the purchase price of $36.2 million in July 2008. The Oasis’ sales price reflects an increase in value of $13 million over a nine-year holding period. “Despite acquiring Sagebrook at the onset of the Great Recession in 2008, the property performed among the best in the Griffis Residential portfolio,” said Griffis Residential Chairman Ian Griffis. “We attribute the success of our Sagebrook and Oasis investments to our asset class specialization and intense focus on management service, which we believe helps drive superior financial results through the best and worst of market cycles.” “We are always buying and always selling,” added Griffis Residential CEO David Birnbaum, noting the properties still fit the firm’s desire for recent-vintage Class A suburban properties but were purchased through the company’s first fund. Griffis currently is on its third fund. “These are two of the nicest assets in Colorado Springs. They are two great properties but it was just the right time to sell,” he added. The sale of the apartment communities is part of Griffis Residential’s continual program of buying and selling multifamily properties, noted Birnbaum. In November, the firm acquired 710 units in Lafayette and Austin, Texas, the latter as part of a planned market expansion beyond the firm’s portfolio in Colorado and Las Vegas. Additionally, Griffis Residential is looking to further expand in target markets such as Seattle, Portland, Oregon, Dallas and California as well as closing on an additional two communities in metro Denver and Austin this month. Griffis Residential owns and manages more than 5,400 Class A apartments in Colorado, Nevada and Texas.