NEW YORK, May 4, 2015 /PRNewswire/ -- Bluerock Residential Growth REIT, Inc. (NYSE MKT: BRG) ("BRG") today announced that its Board of Directors has approved an investment of approximately $12.3 million in a joint venture that will acquire a 204-unit Class AA multifamily project known as Whetstone Apartments ("Whetstone"). Located in a sought-after neighborhood of Durham, North Carolina, Whetstone is within walking distance of Durham's top restaurants, events and nightlife and is in close proximity to Research Triangle Park, as well as the area's many universities.
Whetstone is approaching completion with all units delivered and lease-up progressing at a robust pace. Now 27% occupied and 39% leased, Whetstone has been averaging approximately five new leases per week since early March and is projected to reach stabilization in or about the 4th Quarter of 2015. The property is under contract for a purchase price of $ 35.6 million at a nominal stabilized cap rate of approximately 6.0%.
Whetstone is a new-construction, Class AA multifamily community featuring studio, one and two-bedroom unit layouts averaging 718 square feet with upscale amenities that include a resort style pool, a garden courtyard with grill and fireplace, state of the art fitness center and covered/controlled-access parking, as well as business and media centers. High-grade unit interiors include nine-foot ceilings, gourmet kitchens with stainless steel appliances, and upscale bathroom design and finishes.
Whetstone is located in North Carolina's Raleigh-Durham MSA, home to an estimated two million residents, spanning Raleigh, Durham, Cary and Chapel Hill. The MSA, which is anchored by Research Triangle Park (RTP), North Carolina State University, Duke University, and University of North Carolina at Chapel Hill, offers fast growing technology and research-based economy with strong intellectual capital and robust job creation. The region also houses world-class medical and research facilities, led by Duke University and UNC Chapel Hill. In the last year, the Triangle region alone added more than 25,000 new jobs, while unemployment dropped to its pre-recession level of only 4.3%.
"We are very pleased to be investing in the area and in this project," said Ramin Kamfar, Chairman and CEO of BRG. "We were able to engage in the venture at a favorable price point and believe it will be a source of solid, steady value creation for our investors."
BRG's joint venture partners on this investment are Atlanta-based TriBridge Residential and an affiliate of Bluerock Real Estate, LLC ("Bluerock"). TriBridge is a full service, multifamily investment, management and development company and will also serve as property manager for Whetstone. This is BRG's second partnership with TriBridge.
Pursuant to a comprehensive letter of intent and cost sharing agreement with TriBridge, BRG and the Bluerock affiliate will invest 92.5% of the venture's equity requirement. BRG's investment with the Bluerock affiliate will be structured as a convertible preferred equity investment, providing BRG the right, after stabilization, to convert into a controlling, common membership interest in the joint venture.
About Bluerock Residential Growth REIT, Inc.
Bluerock Residential Growth REIT, Inc. (NYSE MKT: BRG) is a real estate investment trust. BRG focuses on acquiring a diversified portfolio of Class A institutional-quality apartment properties in demographically attractive growth markets to appeal to the renter by choice category. BRG's objective is to generate value through off-market/relationship-based transactions and, at the asset level, through improvements to operations and properties. BRG generally invests with strategic regional partners, including some of the best-regarded private owner-operators in the United States, enabling it to operate as a local sharpshooter in each of its markets and to enhance its off-market sourcing capabilities. BRG has elected to be taxed as a real estate investment trust (REIT) for U.S. federal income tax purposes.
About TriBridge Residential
TriBridge Residential is a full-service multifamily investment, management, and development company based in Atlanta, GA, with over 16,500 units and $1 billion in assets under management as of December 31, 2013. With 65 corporate professionals and 335 on-site staff, the firm focuses on markets in the Southeast and provides a vertically-integrated platform with a 20+ year track record through its subsidiaries and affiliates.
Forward Looking Statements
This press release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Forward looking statements are statements that are not historical, including statements regarding management's intentions, beliefs, expectations, representations, plans or predictions of the future, and are typically identified by such words as "believe," "expect," "anticipate," "intend," "estimate," "may," "will," "should" and "could." Because such statements include risks, uncertainties and contingencies, actual results may differ materially from those expressed or implied by such forward looking statements. These forward looking statements are based upon BRG's present expectations, but these statements are not guaranteed to occur, including the property's ability to generate AFFO as projected. Furthermore, BRG disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward looking statements. For further discussion of the factors that could affect outcomes, please refer to the risk factors set forth in Item 1A of BRG's Annual Report on Form 10-K filed by BRG with the U.S. Securities and Exchange Commission ("SEC") on March 4, 2015, and subsequent filings by BRG with the SEC. We claim the safe harbor protection for forward looking statements contained in the Private Securities Litigation Reform Act of 1995.
SOURCE Bluerock Residential Growth REIT, Inc.