OKC apartment industry finds demand for new units
OKLAHOMA CITY – Multifamily housing in downtown seems to be all the buzz, but real estate professionals said the product is highly demanded outside of the downtown core as well.
Price Edwards & Co. multifamily broker David Dirkschneider represented Interbank in the sale of the 144-unit Southern Oaks Apartments to Derby Shire Holdings LLC, a group based out of state. The complex, at 3400 SW 44th St., was built in 1966 and was sold for $2.64 million, or $20,984 per unit.
He said once the complex was put on the market, he received multiple offers within a week. The sale closed two weeks after being under contract. The buyers have plans for renovations. “The property is in pretty good shape,” Dirkschneider said. “Overall, they don’t need to do much. They will do general upgrades with landscaping and renovate a unit that had some fire damage.”
He said the complex’s interstate highway frontage helped it sell quickly. “It has great visibility on Interstate 44, which has 50,000 cars that pass by it daily,” he said. “We’ve had to do very little advertising because of the visibility.”
The property’s proximity to the interstate may have helped it sell, but the demand for apartments outside of the downtown area is still high. In the next year, there are 2,703 units that are expected to either be completed or started in the Oklahoma City area. CBRE Senior Vice President and Managing Director William Forest said those units will be easily occupied because of interest rates.
“You can’t do too much high-end (apartments),” he said. “Unless interest rates change significantly, single-family homes still provide strong competition for multifamily.”
He said since the 1990s, the metropolitan area has added 1,000 to 1,500 units a year and he does not expect that to slow down. “We’ve been able to absorb it up to this point, and I don’t think that will change,” he said.
That news is good for Toby Brown with the Brown Group, who just bought 15 acres of land at the northwest corner of NW 122nd Street and N. Western Avenue. The property sold for $800,000.
Dirkschneider said Brown plans to build a 144-unit apartment complex as well as a 20,000-square-foot retail center. The apartment complex will be built first and is six months away from breaking ground.
He said the complex will be close to the Broadway Extension and Memorial Road, both of which are prime areas for growth in the city. “It’s one of the best corridors in town,” he said. “I think he’s going to do market-rate apartments. The properties in the area that have been taken care of do very well. He’s hoping to capitalize on a nice, quality product, which he should be able to fill very easily.”
Dirkschneider said the more than 2,000 units that are already planned may not be enough for the growing city. “The amount of new units coming on will be easily absorbed,” he said. “We could easily handle a few more.”