200-unit complex, apartment set for downtown
Developers are preparing to break ground on two large upscale apartment complexes, one on each side of the Ravenel Bridge, reflecting the rush by builders to cash in on fresh demand in the Charleston region.
A 200-unit deal in downtown Charleston is particularly notable in that it marks the first major rental project to hit the peninsula in more than 25 years, said Bob Faith, founder and chief executive officer of Greystar.
Charleston-based Greystar and Prudential Real Estate Investors announced Friday that they have formed a joint venture to build Elan Midtown on about 1.8 acres at the southwest corner of Meeting and Spring streets by mid-2013.
Plans call for two levels of parking and about 6,900 square feet of ground floor retail space. The deal has been in the works for more than two years, Greystar said.
"It's a thrilling opportunity for our firm to provide a truly best-in-class project in our own backyard," said Faith, whose national apartment management and development business is based on Broad Street.
Across the bridge, Adam Monroe and Ryan Knapp of Middle Street Partners LLC recently acquired about 10 acres at Mathis Ferry Road and Walt Miller Street in Mount Pleasant for a 270-unit project to be built with Memphis-based apartment giant MAA as their partner and financier.
The unnamed project is scheduled to be completed early next year.
"The Charleston market, and Mount Pleasant in particular, has been under-served for quite a while with regard to quality … apartment communities," Monroe said this week in a statement. "We think there is a very strong demand for this type of housing in this location."
Rental rates for the two projects were not announced.
Greystar and Middle Street are among a raft of builders that are pursuing apartment deals throughout the Charleston region, where several thousand rental units have been proposed within the last year amid falling land prices and increasing demand.
The first two projects began rising from the ground in Mount Pleasant last year, ending a long dry spell triggered by the one-two punch of overbuilding and a recession.
Several factors are now bringing apartment developers and investors off the sidelines.
One is the fallout of the recession that started in late 2007. That prolonged downturn -- combined with the mortgage crisis and the spike in foreclosures -- has put a big dent in the nation's home-ownership rate, fueling demand for rentals.
At the same time, the local population has continued to edge up, while the region's economy has been showing more signs of life.
With no new development, the number of empty units steadily contracted. Real Data, which reports on Charleston's multifamily numbers twice a year, found in its August survey that the local apartment vacancy rate had dipped to around 6 percent, down from more than 15 percent a few years ago.