DESTIN, FL - Bluerock Residential Growth REIT announced that it has acquired the 340-unit Alexan Henderson Beach Apartments in Destin, Florida. BRG acquired the luxury property off market for a purchase price of $53.7 million, or approximately $158,000 per unit.
The acquisition is projected to yield a pro forma year one stabilized cap rate of approximately 6.4%, which is in line with assets of similar quality in the market. BRG invested 100% of the equity requirement, or approximately $17.2 million.
The property, which will operate as The Preserve at Henderson Beach, was built in 2010 and is among the premier multifamily properties in the Destin submarket. The property offers one- and two- bedroom residences averaging 892 square feet, each with upscale finishes. Community amenities include a clubhouse and lounge, state-of-the-art fitness center, resort-style pool, lake and a pet park.
Located in northwest Florida's "Emerald Coast", Destin is among the most affluent and desirable communities in the Florida Panhandle region, its economy benefitting measurably in recent years from a surge in tourism-related spending. Approximately 17 million tourists visit the area annually, and its beaches are ranked among the top in the US. The property, has outstanding beach proximity within walking distance to Henderson Beach State Park and is one block from Destin's main thoroughfare, Emerald Coast Parkway, the area's primary retail and shopping destination.
The Company plans to refresh the common areas and bring rents, which are now slightly below market, into line with comparable properties. The Company has engaged Greystar to manage the property.
"We are glad to be able to tap the strength and stability of the Destin market. The Henderson Beach property provides an opportunity to generate steady, solid returns for the REIT's portfolio," said Ramin Kamfar, Chairman and CEO of BRG.