This month if Oak Coast properties sold the Pembrooke at the Green Apartments in Denver for $ 163 million, showing price confidence in the market. While many investors expected and expected a price cut in apartment buildings, Phil Nahas of Oak Coast says the price cut is pending and the company has been an active buyer in the Denver market.
“Today I don't see any discounts. I see people writing arrears, with those arrears decreasing over time, but I haven't seen a significant decrease in price expectations as many people expected, "Nahas, managing partner at Oak Coast, told GlobeSt.com.
This does not mean that the multiple family was not affected by the pandemic. Much of the current economic fundamentals have had a major impact on the housing market. "Multifamily had significant challenges," says Nahas. "There has been a huge spike in unemployment, concerns that people will not pay their rent and concerns that businesses will not reopen, which has led to more job insecurity. So far we've seen some arrears, but people are still mostly paying their rent. Multifamily has done really well, especially when compared to retail or hospitality. There are also still investors looking for returns and secure assets. "
Despite the difficulties multi-family homes are facing and the lack of a COVID discount, Oak Coast remains an active buyer and the company has continued to raise capital for new acquisitions, which also shows investor confidence. “We are still very active. We recently opened a trust deed on a new deal and tried to get another deal. We have investors who want capital and returns in an asset class that is quite resilient, ”says Nahas. “Our capital increases are very quick and raising capital during the pandemic was no problem for us. With such exits, there is capital that investors want to redistribute. That is why we are actively acquiring and looking for new opportunities. "
So far, Oak Coast has not changed its acquisition strategy during the pandemic either. “We look at all value-adding core plus assets. We are looking for existing cash flow assets where we can improve cash flow through improved features, better property management, or one or a combination of these three, ”says Nahas. “It is important for our investors to start cash flow from day one. Denver has been a great market for us and we believe in Denver for the long term. We are currently purchasing. "
