Block Multifamily Group
Multifamily properties remained at the top of investors’ wish lists throughout 2012. As the economy continues its sluggish recovery and uncertainty is the new normal, individuals have gravitated towards apartments as an affordable, flexible form of housing. Block Multifamily Group is positioned to meet this demand.
With the amenities being incorporated into newer Class A developments, the renter-by-choice pool has also grown steadily. This has provided a solid footing for key rental housing fundamentals, which have experienced occupancy and rental growth. This demand, coupled with historically low interest rates, has pushed investor pricing beyond their previous pre-recession peak.
BRES just paid about $35.5 million for a 396-unit luxury apartment complex in Austin, Texas and we plan to acquire about 1,000 units a year for the next five years and to buy 500 to 1,000 more units a year with third-parties in that same span. Read more in the Kansas City Business Journal.
Overall, it was a robust year for Kansas City apartments. Strong fundamentals, low interest rates and improving demographics indicate that 2013 will be an encore performance.
|Lexington Farms Apartment Homes, a Class A complex in Overland Park, Kansas, sold for $38.6 million, at a 5.86% cap rate to JMG Realty.|
The year 2012 was a rebound year for construction and development as a whole for the Kansas
City marketplace. The rebound by sector differed slightly across the board, but overall construction activity was up significantly in 2012 compared to past years. Construction pricing and material pricing have started to rise as well, but haven’t quite approached the levels prior to the economic downturn.
Block Construction Services (BCS) played an integral role in several significant projects in 2012. Here are a few:
- Teva Neuroscience
- 154,268 square foot build-to-suit office development in Overland Park, Kansas
- Read the Kansas City Business Journal Article
- Ameriprise Financial
Roe Corporate Centre 15,637 square foot tenant improvement project in Overland Park, Kansas
- Power Group
Roe Corporate Centre 13,529 square foot tenant improvement project in Overland Park, Kansas
- Polsinelli Shughart
Plaza Vista 234,876 square foot tenant improvement project in Kansas City, Missouri
Block Healthcare Development
With the United States Supreme Court upholding the mandate in June 2012, there is no doubt that the PPACA is here to stay. Key stakeholders in the industry are now making directional changes in how they practice medicine and strategize for future growth. One area that cannot be overlooked in this significant shift in health care strategy is in the real estate sector.
- 32 million more people will be covered via a health plan beginning in 2014. That increase in patient volume alone has physician practices and health systems trying to figure out how they will be able to accommodate such an influx of patients.
- In addition to more patients, physicians are seeing their Medicare reimbursement rates cut, which trickles over to the commercial insurance reimbursement which is often a percentage of Medicare. So now physicians are charged with seeing more patients and getting less reimbursement.
Harry P. Drake, CCIM, CPM
Executive Vice President / COO
Block Real Estate Services, LLC