A PIG WITH LIPSTICK

 

Our visit to a 299 unit multifamily Class A community was very refreshing. I actually fell at home with this asset class. I must say the facade was immaculate the gray cobblestone with a three story skywalk defined the property. The community was built on a busy highway with very little walkability, but they wisely built the parking garage with in the design of the community, so in other words you couldn’t determine where the parking garage was located because it basically looked like the other buildings. They clearly lured prospective tenants into the building with large infinity pool, Dark Park, clubhouse with Wi-Fi, pool tables, shuffle board, and poker tables on a no smoking property, uh I think that’s an oxymoron. The unit itself at first glance seem to have some very nice finishes, such as the counter tops, cabinets, floor to ceiling windows, and premium appliances, but the master bathroom only had one sink, and there was low grade carpet throughout the unit, and the vinyl floors looked cheap. You would think for an 800sf unit and paying $2000 a month you would at least throw in some real wood floors. We all know the demand for multifamily is high, so putting cobblestone, waterfalls in front of your leasing office will get you tenants, but we know it’s just lipstick covering all those cheap materials inside their units. These type of projects seem to do well for the first year, or until the next new thing is built, and tenants hop to the newest community. I am willing to guarantee if we go to this same community next year they will offer 1-2 months free rent.  The truth of the matter is for that same price you can rent a 3/2 single family house with a pool just 20 minutes north of that location. (“Real Estate is local by nature”).