ROSEMEADE APARTMENT HOMES
Sacramento, Calif.
ROSEMEADE APARTMENT HOMES
AREA RENOVATED: Two pool areas with children’s wading pool at larger pool
CHANGES MADE: New spas, pool decking, and water-line tile; low seat walls; covered barbecue area with gas grill, tables, and seating; new landscaping and more lawn area
COST FOR POOL AREA IMPROVEMENTS: $300,000
INVESTED PER APARTMENT UNIT: $8,800 for interiors
EXTERIOR, COMMON-AREA IMPROVEMENT COSTS: $2,200 per unit
RENTS AFTER REHAB: One-bedroom, 600 to 736 square feet, $985; two-bedroom, 985 to 1,042 square feet, $1,350; three-bedroom, 1,288 square feet, $1,570
RENT INCREASE PER UNIT: $125
PRE-REHAB OCCUPANCY: 91 percent
POST-REHAB OCCUPANCY: 95 percent to 96 percent
COST PER SQUARE FOOT/ROI: $10.50/17 percent
MFE ARI: B
THE SITUATION: Built in 1992, the exteriors of the 38 buildings at Rosemeade Apartment Homes were remodeled in 2005 by the prior owner, and the new siding, decks, balconies, and windows were one reason The ConAm Group purchased the 465-unit property on 31 acres four years ago. “New siding and decks don’t usually translate into a rent lift,” says Will Stephenson, investment manager. The company also liked the site’s Roseville location, an upscale area of Sacramento, and the potential to increase rent and maintain a strong occupancy rate.
THE CHALLENGE: To gain the additional monthly fees and up occupancy, the developer knew it had to redo unit interiors with condo-quality finishes, as well as improve and add the right shared amenities.
THE RESULT: Goals were met on both fronts. Tops on the list of common-area facilities now are two pool areas with new decks, new spas, low seat walls, a covered barbecue area, and larger lawn to simulate a resort ambience. Even though the overall real estate market declined after the company’s purchase, ConAm still found its bet proved correct. “People will pay for nicely renovated units with granite countertops, stainless steel appliances, new paint, flooring, hardware, and window treatments, especially because we still weren’t as expensive as new units in the market. We offered a good alternative to newer, more expensive product,” Stephenson says.
