WEST DES MOINES, IA – Four Mile Capital, a privately-held real estate investment firm based in Louisville, CO, in a joint-venture with MLG Capitaland BH Equities, has bought the 222-unit, class-A Aspire Townhomes in West Des Moines, IA. The 332,180sf Aspire Townhomes, completed in June 2018, consists of twenty-six buildings and a clubhouse, and is currently in lease up at 76% occupied. BH Management has been awarded the management contract.

The off-market transaction closed December 14, 2018, for a price of $40,250,000, or $181,306 per unit, and FMC intends to spend about $500,000 on additional cosmetic improvements to the clubhouse and pool area. This is MLG’s second investment, and BHE’s first, with Four Mile Capital, and the partnership took out a new 70% LTV Freddie Mac mortgage through Prudential (“PGIM”) as part of their acquisition. 

“After over a year-long pursuit of Aspire, we are thrilled to close on our first Des Moines acquisition,” said Eric Mallon, one of FMC’s principals. “We had been drawn to the market for its economic strength and diversity, but the unrivaled physical product is what ultimately sold us on this deal. Aspire consists of large 2 and 3-bedroom floorplans, all with private entrances, 2-car attached garages, and upscale condo-quality finishes.” The new owners will continue the property’s lease-up and expect to stabilize occupancy at 95% within the next year. “We are fortunate to have such a strong operating partner in BH, a trusted equity partner in MLG Capital, and an efficient debt partner in PGIM. This was a highly complex acquisition that our teams navigated with aplomb,” said Mallon.

The Aspire Townhomes are located 20 minutes from downtown Des Moines, directly across the street from Wells Fargo’s residential mortgage corporate headquarters and minutes from the 1.3M SF Jordan Creek Town Center, one of the Midwest’s largest shopping complexes. “This might be the most well-located project of any that we own,” said Chris Geer, another FMC principal. “Our residents live at the doorstep of a huge variety of retail, dining, and employment opportunities, and Aspire represents a unique and meaningful housing option for this booming submarket.” Des Moines is consistently named to Best Places to Live and Work lists and was recently described as the fastest growing city in the Midwest.

Four Mile Capital continues to pursue additional investment opportunities throughout the U.S, with a specific focus on Colorado, Virginia, Atlanta, Iowa, Wisconsin and Salt Lake City. They use an opportunistic strategy in acquiring off-market properties that fall below the radar of its institutional peers, targeting investments with a total capitalization between $20MM and $100MM, and between $5MM and $35MM of equity.

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SEATTLE, WA -Security Properties bought Highlands at Red Hawk, a 56-unit, Class-A, garden-style apartment community located in Castle Rock, CO for $16,500,000. Security Properties now owns 12 assets in Colorado totaling 2,393 units.

The asset is a Class-A, garden-style apartment community constructed in 2018. The asset consists of 56 units spread out across five residential buildings and 4.55 acres. The units feature a variety of large, townhome style floor plans with direct-access garages, designer backsplashes, granite countertops, stainless steel appliances, in-unit, full-size washer/dryers and walk-in showers with custom tiles. Additionally, the property offers a comprehensive amenity package including a swimming pool, a small clubhouse, and a dog wash station.

Located in Douglas County – the 5th wealthiest county in the U.S. – Castle Rock is most notably recognized for its concentration of families, rolling hills, and silent feel, despite its proximity to an otherwise booming market. Geographically, Castle Rock is distinctive in that it represents the median between Denver and Colorado Springs, the two largest population centers in Colorado. Between Castle Rock and Denver lies the Southeast Business Corridor, home of 260,000+ employees sprawling 42 million square feet of office space.

Castle Rock has experienced incredible population growth over the past decade. From 2010 to 2018, Castle Rock’s population grew by 39%, adding over 18,000 people and outpacing the tremendous growth seen elsewhere in the Denver MSA. Recently named the 10th quickest growing city by Livibility, Castle Rock is expected to grow an additional 34% by 2030 within a one-mile radius of the property. Notable in this growth is the presence of families. Per the U.S. Census Bureau, the average household size is 2.76, with a median age of 34.  65% of the households are represented by married couples, and ~45% have children. 

Per Tad Johnson, Senior Investment Manager at Security Properties, “The Highlands at Red Hawk is a quality addition to our growing Colorado portfolio. The boutique-size of the Property provided a unique opportunity for a long-term investment in an attractive location. This asset will be wholly-owned by Security Properties, and Castle Rock remains a target submarket for future investment.”

The property will be managed by Security Properties-affiliate Security Properties Residential.

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SAN FRANCISCO, CA – U.S. households spent a record amount on rent in 2018 despite a decrease in the number of households who rent their home, according to a new HotPads analysis. Overall, the U.S. spent $504.4 billion on rent in 2018 – more than the entire GDP of Belgium ($494.7 billion)and three times the current net worth of Amazon CEO Jeff Bezos ($124 billion).

Renters spent $12.6 billion more paying their rent in 2018 than they did in 2017. The current median rent is $1,475, up 3 percent from a year ago. Throughout 2018, rents rose about 3 percent year over year – continuing a gradual slowdown in rent appreciation that started in mid-2016.

But, the number of renter households in the U.S. decreased slightly in 2018. There were about 43.2 million renter households across the country this year – nearly 100,000 fewer than in 2017.

A gradual slowdown in rent appreciation has allowed renters looking to buy homes greater ability to save for a down payment in recent years, and millennials – the generation comprising half of today’s renters — are also buying homes more than any other generation. With more eligible buyers on the market, the number of renter households has decreased slightly over the past year.

“After several years of a booming economy, more millennials became financially able to become home owners in 2018,” said Joshua Clark, economist at HotPads. “But, rent affordability continues to be a challenge, as those who still rent are paying even higher prices now than they were a year ago. If interest rates continue rising in 2019, more would-be homebuyers may choose to continue renting, which could place additional pressure on rent prices. Fortunately for renters, the housing market is also cooling nationwide, signaling that the entire market may be leveling off and making it simpler for renters to keep up with housing expenses.”

Of the 50 largest metro areas in the U.S., renters in the New York City metro area spent the most on rent this year – a total of $55.6 billion. But, rent growth in the New York metro also slowed in 2018. Rents in the New York City metro area are rising just 1 percent annually now, compared to 1.8 percent annually at this time last year. 

While rent appreciation has been steady or slowed in many metro areas, some markets in the Southeast and Southwest are still seeing significant price gains. Rents are appreciating the fastest in Orlando, Las Vegas and Phoenix, at a rate more than twice as quick as the national median. Renters in Orlando and Las Vegas spent about $4.4 billion on rent in 2018, while renters in Phoenix spent about $7.5 billion.

Read the full report at HotPads.com.

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