1 r o c k a p a r t m e n t a d v i s o r s b i r m i n g h a m, a l a b a m a rock apartment...
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ROCKAPARTMENT ADVISORS
Rock is the preeminent Apartment brokerage firm in the mid-south with over $1.5 billion in sales
I N T R O D U C T I O N 1
2T U S C A L O O S A A P A R T M E N T M A R K E T
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Why invest in Apartments?
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Three Measures
INFLUENCERS
FUNDAMENTALS
TRANSACTIONS
T U S C A L O O S A A P A R T M E N T M A R K E T
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Economic Influencers for Apartment Investors Focus
University
Demographics
Housing Shortage
T U S C A L O O S A A P A R T M E N T M A R K E T
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5 T U S C A L O O S A A P A R T M E N T M A R K E T
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6 T U S C A L O O S A A P A R T M E N T M A R K E T
Enrollment and On-Campus Housing
School Year
Total Enrollment
Number Change
Percent Change
Undergraduate Enrollment
UG % Change
Graduate Enrollment
Grad % Change
Freshman Living on Campus
UG Living on Campus
2003 20,290 15888 4402 70.40% 23.70%
2004 20,929 639 3.15% 16568 4.28% 4361 -0.93% 72.00% 25.00%
2005 21,793 864 4.13% 17550 5.93% 4243 -2.71% 70.00% 26.00%
2006 23,838 2045 9.38% 19471 10.95% 4367 2.92% 91.00% 29.00%
2007 25,544 1706 7.16% 21081 8.27% 4463 2.20% 91.00% 29.00%
2008 27,014 1470 5.75% 22341 5.98% 4673 4.71% 88.80% 29.80%
2009 28,699 1685 6.24% 23700 6.08% 4999 6.98% 90.70% 29.40%
2010 30,232 1533 5.34% 24884 5.00% 5348 6.98% N/A 29.70%
2011 31,747 1515 5.01% 26234 5.43% 5513 3.09% N/A N/A
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7 T U S C A L O O S A A P A R T M E N T M A R K E T
• 90% occupancy for total rental market prior to storm (of approximately 25,000 units)
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8 T U S C A L O O S A A P A R T M E N T M A R K E T
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Alabama Demographics of 20-34 year olds per MSA - 2011
City20-34 year
oldsTotal
PopulationPercentage
Tuscaloosa 23,906 77,906 30.69%
Birmingham 228,025 1,135,203 20.09%
Huntsville 85,348 430,970 19.8%
Montgomery 80,747 397,663 21.27%
Mobile 86,029 416,462 20.66%
T U S C A L O O S A A P A R T M E N T M A R K E T
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10 T U S C A L O O S A A P A R T M E N T M A R K E T
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11 T U S C A L O O S A A P A R T M E N T M A R K E T
FUNDAMENTALS
MATTER
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12 T U S C A L O O S A A P A R T M E N T M A R K E T
T-TOWN SNAPSHOT
• Tight supply
• Growth in Income
• Supply Coming
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Submarket Occupancy Rate
Birmingham 92.3%
Huntsville 92.1%
Mobile 91.4%
Montgomery 89.7%
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Occupancy Rates Mid Year 2012
T U S C A L O O S A A P A R T M E N T M A R K E T
Average Occupancy
96.4%
96.5%
96.6%
96.7%
96.8%
96.9%
97.0%
Conventional Student TUSCALOOSA
96.95%
96.6%
96.9%
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Source: David Wilson; Rock Apartment Advisors
New Apartment Unit Deliveries
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Tuscaloosa New Construction/Pipeline
Bluffs at Waterworks
115 Greensboro
East Edge
Standard at Tuscaloosa
Townhomes at Metalworks
Boulevard Lofts
Riverwalk Place
Under Construction
Future Starts/ Speculative
Future Starts/ Planned
T U S C A L O O S A A P A R T M E N T M A R K E T
DENIED
Lofts at City CenterRock Point
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Recent Sales
T U S C A L O O S A A P A R T M E N T M A R K E T
Name: Inverness
Price (2011): $12,500,000
Note Sale
208 units
$60,100 per unit
*Sold in December 2005 for $22,750,000/ $109,375 per unit*
Name: Sterling Crimson
Price: $49,850,000
$71,214 per bed
700 beds
6.5 Cap
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Capital and Cap Rates
T U S C A L O O S A A P A R T M E N T M A R K E T
Cap rates have followed debt rates• Class A Low to Mid 6
• Class B Mid 6 to Low 7
• Class C 9 up
New capital formations on 50% of deals today
Debt Standards higher but still available for development and acquisition
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Questions?T h a n k y o u