Orlando, FL - Capstone Apartment

Orlando, FL
Multi-Family Market Summary & Activity Update
Summer 2015
ORLANDO
Contents
Introduction
Introduction2
Market Commentary
3
Economic Overview
4
Sales Transactions
5
Proposed Communities
8
Under Construction
9
Why Choose Capstone?
Lake Eola
2
10
CAPSTONE APARTMENT PARTNERS prides itself on the continual value contributions we are
able to offer our industry; thus, we produce periodic Multi-Family Market Summaries to further
inform the clients and industry we serve. Capstone believes this market snapshot will benefit
current owners, operators, investors, and other industry professionals who are active in the
Orlando, FL MSA , as well as others who are looking to break into this market.
Enon Winkler
Jad Richa
Deucie Bies
Partner
407.616.0250
[email protected]
Investment Advisor
727.282.5547
[email protected]
Investment Advisor
407.470.9030
[email protected]
Brian Hunsicker
Investment Advisor
727.631.5870
[email protected]
Orlando Office
Tampa Office
111 N. Orange Ave.  Suite 1125
Orlando, FL 32801
208 N. Armenia Ave.  Suite B
Tampa, FL 33609
ORLANDO
Best in Business
Declared a “World Class City” by the city of Orlando's mayor, Buddy
Dyer, new developments continue to spring up throughout the
Orlando MSA from a number of brand new venues to the upcoming
Florida Advanced Manufacturing Research Center, Lake Nona Medical
City, Health Village, and Creative Village. Recently, the University of
Central Florida announced plans to add a downtown Orlando campus
that will serve approximately 10,000 students and it is expected
to bring over 4,000 jobs to the area. Due to these developments,
the area is experiencing strong employment growth. Currently, the
unemployment rate sits at 5.3%, which is lower than the national
average of 5.5%.
With the large number of multi-family units being added in this market,
entrepreneurs and companies are finding more reasons to call Orlando
home. Known as Florida's friendliest metro for business, Orlando is
quickly becoming the place to be for high-tech and is attracting a large
number of high-wage tech jobs and technology startups. Additionally,
Orlando’s economic strength lies within the healthcare, tourism,
hospitality, and manufacturing industries that are booming marketwide.
Robust Tourism
Attracting 59 million visitors annually, Orlando is known as the world's
most popular destination where expansion is the norm. New attractions
added in the past six months include the Orlando Eye, a 450-passenger
observation wheel, the famous Madame Tussaud's Wax museum, Sea
Life Orlando Aquarium and, an array of retail shops and restaurants.
These new additions added over 1,000 jobs to the area; thus increasing
regional demand for multi-family accommodations.
Multi-Family Fundamentals
Demand for apartments continues to remain healthy in the MSA
as evidenced by the positive absorption of 2,111 units over the past
six months. The vacancy rate has improved market-wide to 3.7%,
compared to 5.8% a year ago. The development pipeline continues
to flourish with 6,321 units under construction; development of 3,703
of these units began in the past six months, which represents the
most recorded construction starts in the last nine years. The Central
submarket leads the way in development progress and is currently
the most desirable sector in the MSA. Most regional stakeholders
anticipate the vacancy rate will hold steady over the next 12 months,
and remain below the Southeast U.S. average. Despite the new supply,
the region will continue to see strong rent growth of 2.5%-3.5% over
the next 18 months.
Apartment Comparison by Class
Vacancy Rate
Avg. Sq. Ft.
Class
Units
Lease Up
A (1-5 Years in Age)
B (6-15 Years in Age)
C (16-30 Years in Age)
C- (30+ Years in Age)
Stabilized Averages
7,399
6,452
39,014
60,659
31,724
137,849
21.4%
4.1%
3.1%
3.6%
4.3%
3.7%
Totals/Averages
145,248
4.6%
Avg. Rent
Avg. Rent/Sq. Ft.
1,035
1,079
1,081
956
839
970
$1,448
$1,418
$1,085
$967
$821
$988
$1.40
$1.31
$1.00
$1.01
$0.98
$1.02
974
$1,011
$1.04
MARKET COMMENTARY
Orlando is on the Rise
3
ORLANDO
Employment
The unemployment rate in Orlando is 5.3%, which is lower than the state rate at 5.6%
and the national rate at 5.5%. The market has experienced positive job growth of
48,000 jobs over the past twelve months.
ECONOMIC OVERVIEW
Recent Employment Announcements
Nautique Boat Company, a boat manufacturer,
will add 200 new jobs as it expands its Central
Florida facility.
Rank
Employment
1
Walt Disney World
Tourism
53,500
2
Orange County Public Schools
Education
53,500
3
State of Florida Government
Government
17,200
4
Adventist Health System
Healthcare
17,059
5
Florida Hospital
Healthcare
14,225
6
Wal-Mart Stores
Grocery/Retail
13,139
7
Orlando Regional Healthcare System
Healthcare
12,754
8
Universal Studios
Tourism
12,000
9
Federal Government
Government
10,800
10
Publix Supermarkets
Grocery
9,927
The United States Tennis Association has
announced plans to add 119 high-paying jobs to
its Lake Nona tennis center. The average salary is
$100,000.
AT&T has announced its plans to add 100 new
jobs to its offices in Orlando.
Prime Therapeutics, a pharmaceutical firm,
has announced plans to add 100 new jobs as it
expands its operations in the region.
Wages & Population
There are 1,079,670 employees in the Orlando-Kissimmee-Sanford MSA who earn a mean hourly wage of $19.33 and an average annual income
of $40,200. In comparison, the state and national annual income averages are $41,820 and $47,230, respectively.
Historical Population
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
209,401
216,501
224,824
230,239
232,321
235,860
239,425
243,794
250,159
255,483
Orlando-Kissimmee-Sanford MSA
1,866,597
1,939,766
1,999,994
2,034,878
2,060,968
2,082,421
2,139,372
2,174,224
2,223,456
2,267,846
Florida
17,375,259
17,783,868
18,088,505
18,277,888
18,423,878
18,537,969
18,852,220
19,107,900
19,355,257 19,600,311
Orlando City
Source: U.S. Census Bureau
4
Orlando Major Employers
Company
Industry
ORLANDO
Community
City
Sale Date
Units
Sale Price
Price Per Unit
Royal Summit
1972
Orlando
5/21/2015
188
$6,627,000
$35,250
Laguna Oaks
1973
Orlando
5/15/2015
360
$29,150,000
$80,972
Marbella Lake
1985
Orlando
5/15/2015
200
$12,750,000
$63,750
The Park at Laurel Oaks (aka Golf Terrace)
1986
Winter Springs
5/1/2015
552
$54,000,000
$97,826
Century at Waterford Lake
2000
Orlando
4/21/2015
400
$53,250,000
$133,125
The Gallery at Mills Park
2014
Orlando
4/15/2015
310
$66,495,000
$214,500
Tortuga Bay
2003
Orlando
4/10/2015
314
$49,612,000
$158,000
Heritage at Millenia
2006
Orlando
3/31/2015
303
$40,000,000
$132,013
The Summit at Metrowest
1991
Orlando
3/31/2015
280
$26,900,000
$96,071
Promenade Crossings
1998
Orlando
3/19/2015
212
$27,400,000
$129,245
Sun Club
1973
Kissimmee
3/18/2015
130
$4,500,000
$34,615
Hunter's Ridge
1985
Winter Park
3/12/2015
238
$22,500,000
$94,538
The Legends at Champions Gate
2001
Champions Gate
3/11/2015
252
$31,250,000
$12,401
Oakwood
1986
Orlando
3/9/2015
304
$29,900,000
$98,355
Stonebridge Landings
2000
Orlando
3/9/2015
272
$21,800,000
$80,147
Bella
2010
Kissimmee
2/12/2015
432
$60,000,000
$138,889
Westlake
2001
Orlando
2/1/2015
379
$35,900,000
$94,723
Cornerstone
1985
Orlando
1/14/2015
430
$31,550,000
$73,372
Oasis Club
1994
Orlando
1/7/2015
220
$12,550,000
$57,045
Citra at Windermere
2013
Orlando
1/7/2015
360
$61,499,880
$170,833
Art Avenue
2014
Orlando
1/5/2015
300
$47,050,000
$156,833
Terraces at Lake Mary
1997
Lake Mary
1/1/2015
284
$31,000,000
$109,155
Cypress Lake at Waterford
2001
Orlando
12/23/2014
316
$43,967,500
$139,138
Highland Oaks
1992
Orlando
12/19/2014
216
$9,600,000
$44,444
The Park at Vittoria
1991
Orlando
12/16/2014
208
$10,400,000
$50,000
Verano
2008
Kissimmee
12/4/2014
384
$48,750,000
$126,953
Elmhurst Village
2001
Oviedo
12/1/2014
312
$42,100,000
$134,936
Sun Lake
1988
Lake Mary
12/1/2014
600
$66,250,000
$110,417
Sabal Club
1986
Orlando
12/1/2014
436
$51,500,000
$118,119
Kensington Cottages
1984
Orlando
11/18/2014
169
$3,100,000
$18,343
Sabal Palm Lake Buena Vista
1988
Orlando
11/5/2014
400
$49,500,000
$123,750
Arium Grande Lakes
2005
Orlando
10/31/2014
306
$43,299,636
$141,502
SALES TRANSACTIONS
YOC
5
ORLANDO
SALES TRANSACTIONS
Community
6
YOC
City
Sale Date
Units
Sale Price
Price Per Unit
Winter Park Commons
1972
Winter Park
10/27/2014
432
$38,635,700
$89,434
Vista Verde
1989
Orlando
10/23/2014
200
$22,200,000
$111,000
Altamonte at Spring Valley
1974
Altamonte Springs
10/22/2014
260
$18,300,000
$70,385
Orion on Orpington
2007
Orlando
10/21/2014
156
$29,200,000
$187,179
Millennium Pointe
1975
Orlando
10/3/2014
200
$7,000,000
$35,000
Belleza
1973
Kissimmee
9/30/2014
176
$13,250,000
$75,284
Crowntree Lakes
2008
Orlando
9/30/2014
350
$56,288,964
$160,826
Heron Lakes
1988
Kissimmee
9/26/2014
264
$25,266,700
$95,707
Fisherman’s Village
1986
Orlando
9/26/2014
280
$26,847,200
$95,883
Andover Place
1987
Orlando
9/26/2014
400
$30,373,600
$75,934
Vinyards
1986
Kissimmee
9/26/2014
400
$36,883,100
$92,208
Alexandria at Lake Beuna Vista
2001
Orlando
9/24/2014
336
$93,710,900
$278,901
Harper Grand
1994
Orlando
9/24/2014
232
$10,742,000
$46,302
Solis at Winter Park
1986
Winter Park
9/24/2014
596
$57,700,000
$96,812
Mission Club
1995
Orlando
9/23/2014
282
$31,595,000
$112,039
Tzadik Rolling Hills
1995
Orlando
9/22/2014
240
$10,900,000
$45,417
Colonial Ridge
1989
Orlando
9/8/2014
194
$14,200,000
$73,196
Sea Isle Resort
2014
Orlando
9/3/2014
356
$58,100,000
$163,202
Landmark at West Place
2002
Orlando
9/3/2014
342
$38,500,000
$112,573
Aqua Links
1989
Sanford
9/1/2014
140
$4,900,000
$35,000
Auvers Village
1990
Orlando
8/28/2014
480
$50,700,000
$105,625
Beacon Hill
1999
Orlando
8/20/2014
192
$9,500,000
$49,479
Enders Place
2003
Orlando
8/15/2014
220
$37,000,000
$168,182
Parke East
1984
Orlando
8/14/2014
272
$19,500,000
$71,691
Signal Pointe
1969
Winter Park
8/14/2014
368
$40,800,000
$110,870
Retreat at Windermere
2013
Windermere
7/30/2014
332
$54,000,000
$162,651
Park at Salerno
1972
Orlando
7/10/2014
200
$11,400,000
$57,000
Place at Alafaya
1973
Orlando
7/10/2014
400
$21,300,000
$53,250
Silver Oaks
1989
Orlando
7/2/2014
320
$14,250,000
$44,531
Place on Millenia
2007
Orlando
6/26/2014
372
$50,085,000
$134,637
Commander Place
1995
Orlando
6/24/2014
216
$14,800,000
$68,519
Arden Villas
1998
Orlando
6/11/2014
336
$42,050,000
$125,149
ORLANDO
Average Year of Construction
Average # of Units Per Transaction
350
2010
323
312
306
300
2006
2005
2000
263
1995
250
1990
200
1993
1990
1980
150
1975
1975
100
1970
1965
50
1960
1955
0
Class A
Class B
Class C
Class A
AVERAGE
Class C
AVERAGE
Average Price Per Unit
Average Transaction Sales Price
$50,000,000
Class B
$160,000
$46,089,184
$45,000,000
$140,000
$40,000,000
$33,033,268
$35,000,000
$136,172
$120,000
$101,143
$100,000
$30,000,000
$25,000,000
$80,000
$22,214,886
$20,000,000
$71,161
$56,475
$60,000
$15,705,700
$15,000,000
SALES TRANSACTIONS
1985
$40,000
$10,000,000
$20,000
$5,000,000
$0
$0
Class A
Class B
Class C
AVERAGE
Class A
Class B
Class C
AVERAGE
Class A represents properties built from 2000-2015, Class B includes properties constructed from 1985-1999, and Class C signifies properties constructed in 1984 or earlier.
7
ORLANDO
PROPOSED COMMUNITIES
Developer
8
Communities Proposed (100 Units and Above)
Community
Units
Road/Intersection
Submarket
Jefferson Apartment Group
520
510
Mariposa St./Church St.
Central
Summa Development Group
Citi Tower
233
101 Lake Ave.
Central
Orlando Central LLC
Orlando Central
450
100 Jefferson St.
Central
The Tribute Company
Orlando Sentinel Apartments
318
501 North Orange Ave.
Central
Pollack Shores
The Princeton at College Park
226
646 West Smith St.
Central
Real Estate Inverlad Development
Yard at Ivanhoe
630
1427 Alden Rd.
Central
American Land Ventures
Ravaudage
296
Morgan Ln.
Central
ZOM Real Estate Services
Baldwin Harbour
483
1771 Jake St.
East-1
UP Development
Fashion Square
250
Herdon Ave.
East-1
Greystar
Elan at Audubon Park
449
980 Warehouse Rd.
East-1
PAC Land Development
Park Place
100 (PHASE 2)
940 City Plaza Way
East-2
Pollack Shores
Michael Blake Blvd.
300
Michael Blake Blvd.
Northeast
MMI Development
Marden Ridge
272
Maitland Blvd.
Northwest
Lennar Multifamily
Eclipse
252
Millenia Blvd./Hwy.4
South-1
Contravest
Adison on Millenia
292
5151 Millenia Blvd.
South-1
Lake Nona Development Company
Lake Nona Town Center
280
7026 Lake Nona Blvd.
Southeast-2
Unicorp
Zen
266
10463 Perrihouse Acres Ln.
Southwest-2
Skorman Construction
Park Place at Maguire
242
1650 Maguire Rd.
West
Park Place at Maguire
Eclipse
The Yard at Ivanhoe
ORLANDO
Communities Under Construction (100 Units and Above)
Community
Units
Road/Intersection
Submarket
Crescent Communities
Crescent Central Station
280
434 North Orange
Central
Jefferson Apartment Group
Artisan 420
299
420 East Church St.
Central
Contravest
Courtney at Lake Shadow
244
545 Keller Rd.
Central
Atlantic Housing Partners
Lexington Court
108
315 West Concord St.
Central
Contravest
Courtney at Lake Shadow
244
545 Keller Rd.
Central
Epoch
Paseo at Winter Park Village
113 (127 COMPLETE)
940 Canton Ave.
Central
Panther Properties Investment
Integra Village at Lake Forest
209
101 Integra Village Trl.
Central
Pizzuti
Sevens
325
777 North Orange Ave.
Central
Catalyst Development
Eos
296
1221 East Colonial Dr.
East-2
Epoch
Station House
156 (44 COMPLETE)
188 East Crystal Lake Dr.
North
Inland Atlantic
Exchange at Savannah Park
138
5724 Byron Anthony Pl.
North
Lecessee Development
Rize at Winter Springs
224
150 Doran Dr.
Northeast
Weston Housing Partners
Weston Park
201
Longwood St./East Church St.
Northeast
Crescent Communities
Crescent Gateway
249
680 Carriage House Ln.
Northwest
Lennar Multi-family
Eclipse
252
5151 Millenia Boulevard Dr.
South-1
Pollack Shores
Millenia North
288
4550 Millenia Blvd.
South-1
Contravest
Courtney at Universal
355
9703 Avellino Rd.
South-1
Flournoy Development
Citi Lakes
105 (241 COMPLETE)
12024 Meadow Blend Loop
South-2
Rock Harbor Residential
Emerson at Celebration
140 (198 COMPLETE)
1831 Emerson Ridge Rd.
South-2
Faison
Evander Square
24 (165 COMPLETE)
1415 Latta Dr.
South-2
Panther Properties Investment
Integra Cove
338
6800 Westwood Blvd.
South-2
Atlantic Housing Partners
Fountains at Lingo Cove
110
6508 Pershing Rd.
Southeast-1
Lecessee Development
Grandville at Jubilee Park
252 (78 COMPLETE)
6580 Meryvale Ln.
Southeast-1
Klien Companies
Dwell at Lake Nona
274
12701 Narcoosee Rd.
Southeast-2
Picerne Development
Oasis at Moss Park
320
Moss Park Rd.
Southeast-2
Emerson International Inc.
Sanctuary at Eagle Creek
282
9000 Sanctuary Approach Rd.
Southeast-2
Altman Companies
Altis at Sand Lake
315
7001 Palm Pkwy.
Southwest-2
NRP Group
Lake Vue
196
10298 Turkey Lake Rd.
Southwest-2
MMI Development
Windermere Cay
108
8200 Jayme Dr.
Southwest-2
UNDER CONSTRUCTION
Developer
9
ORLANDO
Carolinas
Georgia
Virginia
Tennessee
Kentucky
Alabama
Florida
West Virginia
WHY CHOOSE CAPSTONE?
The People Sell the Deal
Capstone’s Southeast & Mid-Atlantic Investment Sales Team is among the market leaders within our industry sector
and respective region. We place client service above all else, and can guarantee that no one else will work smarter and
harder in achieving the highest level of results for our clients. We don’t rely on a logo to sell the deal, but rather utilize
the industry expertise and investment acumen, tremendous drive and work ethic, and unbeatable salesmanship of the
team members assigned to each project. At the end of the day, it’s the individuals that drive value and sell the deal, and
we know the capabilities of our individual team members are second to none.
Market Expertise & Product Niche
Capstone sits atop the private capital sector of multi-family investment sales for multiple reasons. Our deliberate and concentrated focus and
expertise in not just the primary markets of the Southeast & Mid-Atlantic, but also the secondary and tertiary markets within our region, identifies
us as the ideal candidate for such assignments. Capstone’s investment sales team has completed a multitude of transactions across the primary,
secondary, and tertiary markets of the Southeast & Mid-Atlantic, and our track record of success can be attributed to our comprehensive coverage
and expertise among these markets, as well as our relationships with the owners and investors who remain active in this environment.
National Exposure via Cutting Edge Technology
Capstone has developed and maintains industry leading national databases, expansive information delivery methodologies, and various
proprietary activity tracking systems. These tools are utilized daily by the investment sales team, analysts, and back-office support staff allowing
for optimal operational efficiency. This enables Capstone’s investment brokerage team to spend nearly all of its time servicing clients, interacting
with industry players and active asset traders, and promoting transactions.
Reputation and Results
Capstone prides itself on its impeccable industry reputation and the core values and behaviors of the firm that drive daily operations. The
firm possesses an unblemished reputation and track record industry-wide, and, as such, the firm’s trusted relationships among the apartment
investment community continue to facilitate seamless, fluid, and successful sales transactions.
*
10
Information in this report has been provided by the following resources: The Orlando Real Data Report April 2015, Direct Company Contact , OBJ Book of Lists 2013, REIS Report, Costar, Business Journals,
Harris InfoSource, Lexis Nexis, LoopNet, Bureau of Labor Statistics, county tax records, and various multi-family industry contacts. Source images provided by Jared (p. 1) and Rusty Clark (p. 2, right) via https://
creativecommons.org/licenses/by/2.0/, and Bob B. Brown (p. 2, left) via https://creativecommons.org/licenses/by-nd/2.0/.