Harbor’s Latest Flip in Nashville
- Jun 11, 2015
In the latest sale following Harbor Group International’s purchase three years ago of four Nashville apartment complexes, an HGI affiliate has sold the 627-unit Cherry Creek apartment community there for $86.5 million, HGI announced Wednesday. The buyer was not disclosed.
HGI had acquired the 1,593-unit portfolio in August 2012 for $130.5 million; the individual purchase price for Cherry Creek was $64.4 million. The company invested approximately $2.8 million in Cherry Creek during its ownership, an HGI spokesperson told Commercial Property Executive.
In February 2012, HGI sold the 260-unit Preakness apartment community, and in August 2013 it sold the 360-unit Cambridge at Hickory Hollow Apartments. An HGI affiliate still owns the one remaining property from that portfolio, the 346-unit Arbors of Brentwood.
“Cherry Creek performed well, with occupancy consistently above 95 percent and sustained rent growth throughout our three years of ownership,” HGI president T. Richard Litton said in a release.
Built in phases from 1985 to 1999, Cherry Creek consists of 26 residential buildings with an average unit size of 1,010 square feet. Amenities include a clubhouse with business center, three swimming pools, two lighted tennis courts, an indoor racquetball court, sand volleyball court, laundry facility, tanning booth, car care center, picnic area and resident walking trail.
Litton’s comment that the Nashville market “continues to generate strong rent growth and significant investor demand” is backed up by a recent report from Marcus & Millichap.
Nashville has benefitted from five straight years of at least 3 percent annual job growth, according to the M&M report, and even with more than 4,000 apartment units a year being delivered, strong absorption has held the overall vacancy below 5 percent.
Effective rents are predicted to rise 4.6 percent this year, following a 5.9 percent jump in 2014.