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VOL. 111 | NO. 111 | Tuesday, June 17, 1997

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lj 10/5 cates National REIT acquires Wyndridge Apartments By LAURIE JOHNSON The Daily News Two sections of an East Memphis apartment complex have been purchased by the nations largest multi-family real estate investment trust for $30 million. Chicago-based Equity Residential Properties Trust (EQR), which owns more than 98,000 multi-family units in 32 states, closed recently on Wyndridge II and Wyndridge III, located at 6277 Lake Arbor Drive. The publicly held REIT acquired the two properties from a ZML-Wyndridge, an entity of the Chicago-based private real estate investment partnership Zell/Merrill Lynch Real Estate Opportunity Partners L.P., according to a trust deed filed recently in the Shelby County Registers Office. EQRs acquisition of the Wyndridge property marks the REITs first foray into the Memphis apartment market, said Cindy McHugh, senior vice president of investor relations and corporate communications. "We liked Memphis growth potential," McHugh said. "We typically acquire two- to three-story garden style apartments located in suburban areas showing good job growth and whose economies are dynamic and above the rate of inflation." McHugh said one of the most attractive aspects of the Wyndridge property is its location, which is in the Hickory Ridge area near Germantown. "With real estate, the key is location, location, location," she said. "We believe that this is one of the stronger apartment markets in the Memphis area. "Its a middle- to upper- income community, and it has excellent access to I-240 and I-40, which puts it in close proximity to retail, restaurants and entertainment." Major arteries near the property include Winchester Road and Mendenhall Road. At the time of sale, Wyndridges occupancy rates averaged 98 percent, which also contributed to the propertys attractiveness as an investment, McHugh said. The new ownership group has no renovation plans for the property, which includes amenities such as a swimming pool, tennis courts, a fitness center, indoor racquetball courts and a jogging trail. "This property was built in 1988," McHugh said. "In the apartment business, this is still considered fairly new." McHugh said there was a good chance EQR would continue to invest in the Memphis area. "Although we dont have anything to announce right now, our acquisitions team does like the dynamics of the Memphis market." Mike Stein, senior vice president with Prudential Securities, agrees that the multi-family real estate investment market in Memphis, as well as throughout the Mid-South, is doing well at the half-year point. "The real estate industry, in general, is doing very well," he said. "I think Memphis and the Mid-South is a good apartment market, judging from the activity of the REITS." Stein characterized local apartment community acquisitions by REITS as about a "once-a-month occurrence." The prospect of rising interest rates also drives up the demand from consumers for apartments, he said. "Any time that you have some fears of inflation, real estate markets tend to rise. "Whenever there is a rise in interest rates, the single family mortgage market goes up, home buying sort of slows, and people tend to rent apartments." EQR owns four apartment communities in Nashville, the only other Tennessee market in which the REIT has a presence. McHugh said EQRs investment strategy is to acquire properties throughout the United States, not in one particular market or region. "This insulates us from any downturns in any specific market," she said. About 15 percent of EQRs portfolio is in the southeast U.S. The REITs goal is to own 100,000 apartment units by 1998. "Were almost there," McHugh said. Acquisitions of about 1,500 units currently are pending.
PROPERTY SALES 106 318 6,336
MORTGAGES 131 363 7,084
BUILDING PERMITS 178 482 13,795
BANKRUPTCIES 40 208 4,301