Out of town investment groups still spending big bucks on Frederick County Commercial Real Estate with Multifamily continuing to capture top billing … but one local business expansion is the exception!
The eighteenth year of this new millennium closed out with improved commercial sales volume reaching $336 million, and out of that title transfers of multifamily properties gobbled up 52% of that dollar figure while only comprising 10% of the 144 transactions. It appears that the first quarter of 2019 is skipping down the same path laid out the four previous quarters, but at a heftier pace – out of an improved property CRE volume of $91.3 million, in a mere 6 transactions, multifamily volume exceeded 68% of the total. Two of those apartment deals hit the top 5 overall sales at a figure of nearly $59 million.
Frederick, Maryland is clearly becoming a targeted spot for large real estate out of town investment groups. Consider that within a total volume of $110,000,000, the top five transfers in the first three months of the year exceeded $80.7 million – 96% of which came from out of county-based investment groups.
Seems the word in getting around that this is a good place to park some CRE dollars.
All that stated, out of the five deals that topped the charts, one locally owned business is making our community proud! So, we will start with this one first:
Locally “Grown”
The Common Market Co-op, a Frederick-based, community owned, organic and natural foods grocery store, as the website describes the business, finally took the long-awaited plunge to expand its operations to the north side of Frederick. They chose the former 47,700 square foot Safeway building situated on 5.5 acres situated at the NE corner of Fairview Avenue and West 7th Street. The deal closed on March 4, 2019 at a price of $3,550,000, or a price of $75 per square foot of building area. Not a bad figure, when one considers that the county tax office had the assessment at over $5.8 million! As a longtime owner/member of the co-op, I am personally very excited to see how many members of the community have embraced this business and helped it flourish!
Hospitality
While new hotels have been popping over the last couple of years around the county, it’s been quite a while since an existing local hotel has changed hands in Frederick; so, we should take notice.
Back on January 3rd of this year, the well-known Hampton Inn at 5311 Buckeystown Pike was added to a large hotel portfolio affiliate of AVR Realty Company based in Yonkers, New York. The 167 room, 89,000 square foot structure built in 1984 sold for $16.2 million – that is a figure of $97,000 per key (as it is referred to in the biz).
Multifamily
Without a doubt the apartment market is a very attractive investment vehicle for the big (and smaller) money guys. Out of this quarter’s top 5, three of the deals were multifamily. Two of which topped $10 million each.
- Monocacy Woods East Apartments at 1599 N. East Street in Frederick was purchased by a Columbia, Maryland based group registered as Naylor Knox and Alabama LLC for $2,396,000 on the 8th of January. The property was built in 1972. The 20,000 square foot two building complex has 25 units, which equates to $87,000 per unit.
- Creekside at Taskers (Chance) is an independent senior living building that has 120 units. The 1995 structure on 5.5 acres is located at 100 Burgess Hill Way in Frederick and was transferred to BB Creekside LLC, a Bethesda, Maryland investment group, on January 11th for $11.8 million – a per unit price of $98,300.
- Saving the biggest for last, the 206-unit luxury apartment complex known as the Retreat at Market Square was swept up at a price of $228,000 per unit or a mere $47 million on March 29th by another Bethesda based investment group. The first of the 261,000 square foot two building complex was completed in 2013, with the second wrapping up the following year. The project is very well situated in the heart of all the activity that has centered around the residential and retail mecca of Clemons Corner and Market Square on the north side of Frederick City at US 15, Wormans Mill Road and Liberty Road (MD 26).
Always tune into the MacRo Report Blog for a deeper look into the all things that impact the local commercial real estate market … and if you are in need of land and commercial real estate services, please give us a call!
Rocky Mackintosh, President of MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland, has been an active member of the Frederick community for over four decades. He has served as chairman of the board of Frederick Memorial Hospital and as a member of the Frederick County Charter Board from 2010 to 2012. He currently serves as chairman of the board of Frederick Mutual Insurance Company. Established in 1843, it is one of the longest enduring businesses in Frederick County.