This article was originally published by The Di Wire on 12/04/15.
Bluerock Growth Fund completed the sale of Artisan on 18th, a Class A, 153-unit multifamily development in downtown Nashville, Tennessee. The property sold for $35.2 million, generating a return of two times the company’s original equity investment and a net internal rate of return of approximately 35.2 percent, after a hold period of 28 months.
Located at the center of Nashville’s academic, medical and entertainment industries, the Artisan on 18th development was able to attract tenants from an industry base that supports nearly 50,000 jobs in the area. Community amenities include a landscaped courtyard with sundeck, an outdoor grilling area and fireplace, a state-of-the-art fitness center, cyber clubroom with coffee bar and business center, a pet park, and a parking garage. Unit amenities include features such as granite countertops, high-end flooring, designer cabinetry, full-size washers and dryers, private balconies, and 9-foot ceilings.
“Artisan on 18th has been a tremendous success story for [Blue Rock Growth Fund], and has validated our investment approach. We were able to effectively double our initial investment by recognizing an unmet demand in the Music Row district,” said Ramin Kamfar, chief executive officer of Bluerock.
“Development and lease-up were completed in June 2015 — ahead of projections in terms of rents and velocity, both — and the property was 100 percent leased at the time of sale,” the company said.
Artisan is the second sale by Bluerock Growth Fund this year, and in both cases investors received distributions at or above two times the company’s original equity investment. In January 2015, the fund sold 23Hundred Berry Hill in Nashville, Tennessee for $61.2 million. The sale generated a net internal rate of return of approximately 48.1 percent after a hold period of 22 months.
Artisan on 18th was purchased in a joint venture with multifamily developer Stonehenge DCM LLC, which oversaw development, and with affiliates of Bluerock Real Estate.
Bluerock Real Estate is a national real estate investment firm founded to provide institutional investments for individual investors. Bluerock’s current portfolio consists of more than 12 million square feet of multifamily, office and retail properties with more than $2 billion of managed assets across the United States.