A projected pickup in demand for apartment living is priming the development pump again, with the latest local project planned for Mount Pleasant.
A Florida investment firm said Tuesday it is teaming up with a Virginia real estate firm to build 258 residential rental units near Long Point Road and U.S. Interstate 526.
Orlando-based CNL Macquarie Global Growth Trust has formed a joint venture with Woodfield Investments to develop the project on 32 acres they recently purchased for $3.4 million. The site for Woodfield Long Point is on
Wando Park Boulevard.
The joint venture joins a growing roster of apartment builders that are jumping back into the game after being sidelined by the last recession. On Daniel Island, for instance, Red Mountain Development's 270-unit Talison Row has been moving through the city of Charleston's approval process. On the peninsula, Greystar Partners is proposing to build 201 rental units near Spring and Meeting streets.
Woodfield Investments previously was eyeing a tract on the other side of I-526, near the entrance to the Grassy Creek subdivision, but it shelved that plan amid neighborhood opposition.
"We've been looking for a long time," said Mike Schwarz, a development partner in the Ashburn, Va.-based firm.
Work will start in the third quarter, and completion is set for late 2012. The total cost was not disclosed, but CNL Macquarie said in a Securities and Exchange Commission filing that it is borrowing $21.4 million to fund the construction.
The project includes three four-story buildings and a clubhouse. Some of the units will have views of the Wando River and the marsh. Rental rates have not been set but they will be "market driven," Schwarz said.
CNL Macquarie and Woodfield said they were targeting the junction of I-526 and Long Point because of its proximity to a major commuter highway and local retail destinations.
Schwarz said the timing is ripe because the apartment stock in markets such as Mount Pleasant has been dwindling. Numerous rental units in the East Cooper area were converted into condominiums over the past five to 10 years, and few new projects are on the drawing board.
"Mount Pleasant has seen a net reduction in apartment supply," Schwarz said.
John McRae, managing director at CNL Commercial Real Estate who handles property acquisitions for CNL Macquarie, said a lack of financing has been the biggest obstacle for new apartments.
"Really the projects that are getting financed are in the best locations and the best markets. ... That's another reason we ended up in this market and this location," McRae said.
Woodfield Investments owns two other local apartments -- in Woodfield South Point in West Ashley and Woodfield St. James in Goose Creek. Both were built within the last few years and have weathered the recession well, Schwarz said.
"Despite the national downturn -- and certainly Charleston was affected by that -- we've still been really pleased with the results of those communities," he said.
Contact John McDermott at 937-5572.