Greenfield apartment market heats up with sales, development activity

The Greenfield apartment market is seeing a flurry of activity. Two projects just opened, a third is planned and a Chicago buyer has scooped up a 10-year-old complex for $14.5 million.

An affiliate of Chicago-based Equity Property Management bought the 288-unit Washington Village apartments, 4211 W. Potomac Drive, just south of U.S. 40.

The complex of one-, two- and three-bedroom apartments is 93.5 percent occupied and average monthly rent is $747. The buyer assumed the mortgage in the sale, which was brokered by Michael Wernke of the local office of Marcus & Millichap Real Estate Investment Services. The seller was a local partnership that developed the property in 2000 and 2001.

Washington Village is Equity’s second Indianapolis property. The company also owns and manages 220-unit Castleton Manor at 71st Street and Binford Boulevard and is negotiating to buy a complex on the west side.

Greenfield is attractive to apartment owners in part because of recent hiring in the area.

At least some of the job growth is at a former Eli Lilly and Co. research complex, which Lilly sold two years ago to Covance Laboratories, which has been adding jobs. And Chicago-based Stanley Black & Decker Inc. just leased 220,000 square feet at 501 W. New Road in Greenfield, where it will consolidate two manufacturing plants and add 80 jobs.
 
“Greenfield is considered a favorable market due to pretty good job growth and good demographics. And it’s a convenient commute to Indianapolis,” said George Tikijian, a principal in the apartment brokerage Tikijian Associates. (At IBJ's recent Commercial Real Estate & Construction Power Breakfast, Tikijian explained how the economic downturn has aided the multifamily sector; see video below.)

In 2008, Tikijian’s firm brokered the sale of Greenfield Village, a 256-unit complex developed by Carmel-based Pedcor Companies. The developer sold the complex for $44,000 a unit to a New York buyer.

Pedcor just opened Prairie Meadows, a 100-unit complex financed with tax credits that is just west of Greenfield at U.S. 40 and County Road 75.

Another factor in the growth of the Greenfield apartment market is its seniors population.  

Among the properties trying to capitalize on that segment is Stonehurst Pointe, a 37-unit seniors project that opened this month on the west side of Greenfield. Developed by locally based Milestone Ventures Inc., the $5 million complex of two-bedroom apartments is one of several the company owns around the state, but it’s the first in Greenfield.

“Greenfield is a neat city. Demographics show an older population that would respond to this type of unit,” said Chuck Heintzelman, a principal in Milestone Ventures. He said 21 of the units are occupied and 31 are spoken for—a quick lease-up that has validated Milestone’s faith in the market.

Another local apartment developer, The Paragus Group, is about to close on tax-credit financing for the 62-unit Reflections at Bluestone, a $5.3 million seniors complex it plans to break ground on after the first of the year.

That project would be adjacent to Bluestone, a 208-unit, high-end complex just north and east of U.S. 40 and State Road 9. Bluestone, also developed by Paragus Group, opened last year and is about 80 percent occupied. Its average rent of $770 is at the top of the market in Greenfield, where average rent is about $707 a month.