A Florida-based buyer picked up a value-add apartment asset in Colorado Springs for $47 million.
Priderock Capital Partners purchased The Preserve at Hidden Creek, a 240-unit community at 5910 Vista Ridge Point.
“It was definitely a yield driven deal,” said Jake Young of CBRE Capital Markets, Colorado Multifamily Investment Properties. “Investors from in and out of state are seeing that there is probably better rent growth in the Colorado Springs market, there is less new supply to deal with and a pretty good delta to what Denver rents are right now to Colorado Springs. So, they are able to underwrite pretty aggressive going-in cap rates and still hit their yields that they need.
“The Preserve at Hidden Creek gave investors the chance to take advantage of the rapidly growing Colorado Springs multifamily market, which has seen rent growth outpacing Denver’s over the past 12 months and is now at sub-5 percent vacancy levels,” Young said.
“Appetite for value-add multifamily communities in Colorado Springs remains strong, and The Preserve at Hidden Creek is a prime example of a strategic opportunity,” added Young.
Young and CBRE’s David Potarf, Dan Woodward and Matt Barnett represented seller Griffis/Blessing Inc. in the sale of the community built in 1996.
Comprising a mix of one-, two- and three-bedroom units, Preserve at Hidden Creek also features “above normal” average unit sizes of more than 1,000 square feet, he added.
Additionally, some of the apartments had been renovated, laying the groundwork for the next owner to continue to add value with improvements to the community.
The Preserve at Hidden Creek, located in the north central part of the city near Briargate, features apartments with full-size washers and dryers, gas fireplaces, additional storage and balconies/patios. Select units include vinyl wood flooring, updated countertops and cabinets, stainless steel appliances and upgraded lighting.
The community features a clubhouse, pool with a year-round spa, available garages, a fitness center, WiFi and a business center. Additionally, it is located within Colorado Springs School District 11 and adjacent to the Sunset Mesa open space.
At the time of sale, it was around 95 percent occupied.
“We purchased the property in November of 2011. We added value to the investment by upgrading the clubhouse, pool and upgrading a number of the units. The property has performed very well for us and it exceeded our return targets for our investors,” said Gary Winegar, president of investment services for Griffis/Blessing.