Passco Cos., based in Irvine, Calif., recently announced the purchase of The Reserve at Nocatee, a 244-unit luxury class apartment community in Ponte Vedra, Fla., which is about 25 miles southeast of Jacksonville. The $54.9 million deal was facilitated by Brian Moulder and Dhaval Patel of Walker & Dunlop. The community is nestled in the Nocatee master-planned development in St. John’s County, an area known for high barriers to entry. Impact fees can be as high as $40,000 per unit due to high utility costs and school fees.
“Ponte Vedra is in unincorporated St. Johns County, which is not only one of the most affluent areas in the state, but among the top 10 fastest growing counties in the country,” said Colin Gillis, vice president of acquisitions, East, at Passco Cos. “Residents of The Reserve at Nocatee also benefit from its location in the No. 1 school district in Florida. Further, it is the only multifamily property within the country club-like environment of Nocatee, which was recently ranked as one of the best-selling master-planned communities in 2019.”
The Reserve at Nocatee was built in 2018 and sits on over 20 acres of land. Residents have exclusive access to all of the community pools, water parks, and a private beach club on the Atlantic. There’s also golf cart trails, bike paths, dog parks, and fitness centers.
“Nocatee was originally developed for single-family homes—and sells nearly 1,000 homes each year—but has continued to expand to include retail, office, medical facilities, grocers, restaurants, and more,” said Gillis. “Along with these developments, there are many nature reserves, with 60% of the 12,500-acre parcel used for conservation and land preservation, adding to its unique appeal.”
Courtesy Passco Cos.
The swimming pool at The Reserve at Nocatee, Ponte Vedra, Fla.
The Reserve at Nocatee’s unit mix includes one-, two-, and three-bedroom units. Interiors offer washers/dryers, wood/vinyl flooring, granite countertops, stainless steel appliances, and private balconies. There’s also a fitness center, a resort-style pool with cabanas, and a pet park.
Going forward as concerns about how long and how deep COVID-19 will affect future acquisitions and the multifamily industry, Passco is taking the long view. “Passco has operated throughout all market conditions for the past 22 years,” says Alan Clifton, chief investment officer. “Understanding that the market is cyclical, we’ve strategically built a resilient portfolio and are well-positioned to weather storms. Considering this unique environment that is changing day by day, we are remaining prudent. That said, we remain optimistic that any slowdowns in activity will be short lived.”
Trying to maintain business as usual is also a challenge in terms of being able to do the homework that is necessary for successful acquisitions. “We are unable to purchase an older vintage property without doing a full due diligence on the asset, including doing thorough unit walks,” adds Clifton. “Those are on a standstill since nobody is allowed onto the properties with the current COVID-19 policies in place. If we have a newer property that we are looking at with a trusted seller, there is a good chance we could buy without doing our full due diligence process due to our strong relationship with them.”