Atlanta is the economic capital of southeastern US.

Reserve at Garden Lake

33,541464 | -84,424121

Atlanta (Georgia), the economic capital of the southeastern United States, has been profiting from increased consumer confidence resulting in strong local economic growth in recent years. With 5.7 million relatively highly-educated inhabitants, Atlanta is
the tenth largest metroplex of the United States and is home to a large number of Fortune 500 companies, including several well-known ones such as Coca-Cola and Delta Airlines. Following a growth in employment of approximately 80,000 jobs per year in both 2015 and 2016, expectations are that approximately 70,000 jobs will be added in 2017. This is a solid basis for the increasing demand for rental apartments.

As a result of the ongoing employment growth, the rental apartment market is strong. In the meantime, vacancy in Atlanta has dropped to below 5%, and a further decrease is expected in 2017. Despite the increased delivery of new rental apartments, the supply can be absorbed easily and therefore further rental price increases in the market are possible. After a rent increase of over 6% in 2016, real estate analysts expect a growth of 5% in the coming year, which is above the long- term average of 3%. Given this dynamic, Atlanta has risen 6 places in the ‘National Multifamily Index’ to number 14, making it the highest-listed southeastern city.

Key data

Project name
Reserve at Garden Lake

Location
1000 Lake Ridge Parkway, Riverdale, Atlanta, Georgia

Initiator
REALIANCE USA B.V.

Lokale partner
InterCapital Group (ICG)

Property Manager
Dayrise Residential

Category
278 rental apartments

Expected investment term
5 years

Exit strategy
Sale to an investor

Participation
Minimum US$ 12,000 excl. 3% emission costs
(160 participations of US$ 25,000)

Structure
Direct participation in Reserve at Garden Lake Apartments LP

Bank loan
US$ 16,000,000

Equity
– Investors (regular equity) US$ 4,000,000
– Mezzanine capital US$ 1,000,000
– ICG and REALIANCE US$761,400 (minimum 10% /US$ 576,140)

Quarterly distributions
8% per annum

Projected gross capital growth/ gross ROI
91% in 5 years/ 18.2% per year

Unique selling points

Atlanta, the economic capital of the south-east, is one of the most dynamic regions of the US and has a favorable business climate and a pleasant living environment for its (highly educated) residents.

Atlanta is a major US growth city with strong population and employment growth resulting in an increasing demand for rental apartments.

Location near Georgia Highway 85, conveniently located for employment centers including Hartsfield- Jackson International Airport, downtown Riverdale as well as the Southlake Mall and Pavillion with a wide range of retail.

Local partner is highly experienced as investor and property manager with similar projects in the south of the US with Atlanta as one of her major markets.

Defensive risk profile is strengthened by a fixed 10-year loan, so that there is no refinancing risk during the term.

Low annual interest rate of 4.75% (budgeted) and high current physical occupancy rate of 96% in combination with renovation potential provide an expected cash-on-cash return of 8% per annum.

ICG and REALIANCE account for 13.2% of the total risk capital required.

Location

For more information you can reach REALIANCE at +31 (0) 20 21 03 180 or invest@realiance.nl