May 13, 2019
Ari Abramson of CRC Participates in Mid-Atlantic Multifamily Forum
Ari Abramson (second from right), Vice President, Acquisitions for Continental Realty Corporation (CRC) recently participated in the Mid-Atlantic Multifamily Forum sponsored by Marcus & Millichap. Entitled “Needles in Haystacks: Emerging value-add opportunities in the Mid-Atlantic region,” the seminar was moderated by Matthew Drane (second from left), Regional Manager, Marcus & Millichap. Additional panelists included (from left) Pat Gniadek, Avalon Communities; Doug Root, Blackfin Real Estate Investors; Phyllis Hartman, Hartman Design Group; Ben Beggs, redlQ; and Matt Jones, Harbor Group International.
The range of topics focused on which Mid-Atlantic markets are increasingly attractive among buying groups; emerging changes in acquisition and underwriting criteria; which amenities and physical improvements elevate the property and make them more desirable; how rising construction and labor costs impact all asset classes; and overall takeaways on the current market cycle.
According to Abramson, the current environment among investors seeking value-add opportunities at conservative cap rates remains the most competitive among all asset classes, especially considering the limited supply now available. “This confluence is translating to increased valuation upon sale as, often times, investors are accepting lower yield andare taking on additional value-add risk to achieve a core-plus return,” he explained.
“Continental Realty Corporation maintains a conservative and fiduciary underwriting approach when seeking value-add multifamily acquisitions, and remains primarily focused on secondary markets most often located in first or second ring suburban areas around the urban core,” Abramson explained. “Given the competitiveness, we employ a measured screening process that analyzes rent to income in the marketplace that determines how much people can afford and allocate to rental payments, as well as making rent vs single family home purchase comparisons. We carefully study the nearby school districts, crime rates and proximity to employment and retail centers. Continental is frequently able to overcome short-term competition based on our fixed, long-term debt approach and ability to achieve necessary property upgrades using an in-house and integrated team.”
Another emerging trend, according to Abramson, is the search for amenities that provide differentiation in the marketplace and specifically target the middle-income and dual-income audiences. “When evaluating a prospective multifamily development, we analyze and rank the ability to commute into the central business district as well as looking for ways to create separation in the amenity offerings that are differentiated from a modern fitness center or dog park,” he said. “Possibilities include a dog spa, organic garden and authentic un-programed spaces that encourage residents to interact and create a sense of community.”
Amazon’s move to the Northern Virginia is already impacting this region from a multifamily perspective. “Even though the influx of jobs are at least three years away, rising property valuations are already baked into pricing and existing communities are drawing the interest of possible investor and buyers,” Abramson said.
Technological advances are being engineered into new construction properties and, when possible, into older ones to keep pace with resident demand. Features include smart home packages with WiFi-controlled thermostats, lighting and security systems and a package concierge system.
Continental Realty Corporation (CRC), is focused on acquiring value-add retail and multifamily properties, located throughout the Mid-Atlantic and Southeast regions of the United States. Headquartered in Baltimore and founded in 1960, CRC is a full-service commercial real estate and investment company. The privately-owned firm owns and manages a diversified portfolio of retail centers, consisting of over 4 million square feet of commercial space, as well as almost 10,000 apartment homes. Positioned throughout the Mid-Atlantic and Southeast regions, the portfolio’s value exceeds $2 billion.
February 15, 2022