Over the past couple of years, Nashville, Tennessee, has been one of the poster children for apartment supply. But Doug Root, co-founder and managing partner of Blackfin Real Estate Investors, says the market is improving.
“Strong net absorption is finally outpacing new construction deliveries,” Root told Multifamily Dive. “There's certainly a lot more stability coming into the market. It's poised for much better fundamentals in the short term as that pipeline is really dwindling.”
Seeing a light at the end of the tunnel in Music City, Root’s Arlington, Virginia-based Blackfin and Enterprise Community Partners have announced the acquisition of the Brookridge Apartments, a 177-unit, garden-style property in the south Nashville submarket of Antioch, according to a press release shared with Multifamily Dive.
With an average unit size of 1,023 square feet, the 1986-vintage property is comprised of approximately 26% one-bedroom and 74% two-bedroom units. Brookridge Apartments is Enterprise’s first investment of its Enterprise Preservation Fund VI from the Columbia, Maryland-based firm’s preservation equity business, per the release.
“As costs continue to rise in high-growth markets like Nashville, preserving existing affordable and workforce housing is more important than ever,” Lianna Petroski, senior vice president, head of acquisitions and deputy fund manager at Enterprise, said in the release.
Brookridge Apartments offers access to Interstate 24 and is near top regional employers and downtown Nashville, per the release. Sustained in-migration and growth across health care, education, advanced manufacturing and logistics help drive demand in the market, per the release.
While it has been difficult to find deals, Root said he is starting to see some properties hit the market.
“There's a lot more distress, like in REOs starting to work their way through where previously sellers might have been holding on and trying to get their lender paid back,” he said. “Now, that ship has sailed and lenders are taking the real estate back, we are starting to see more and more of that product become available.”
In addition, owners are coming to terms with the fact that values won’t snap back any time soon, and interest rates remain high.
“We're starting to see their mindset shift as well, as people want liquidity from their investments,” Root said.
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