Additional Units and a Value-Add Program Creates Significant Returns in Muscle Shoals, AL
Engel’s ownership, management, and development of the property was able to successfully position Arbor Village to be marketed and subsequently sold.
On May 16, 2014 Engel Realty purchased Arbor Village a 160-unit multifamily property in Muscle Shoals, Alabama. Arbor Village was originally constructed in 1987 in multiple phases. What attracted Engel to Arbor Village was the opportunity to purchase the property from the developer, the quality of the construction, the inclusion of additional land for the construction of 40 additional units, as well as the attractive pricing for the property considering the age and construction. Also, the submarkets of Muscle Shoals, Florence, Sheffield, & Tuscumbia, Alabama have a solid rental base with high occupancies and attractive potential for rent growth. In 2016 Engel completed the construction of the 40 additional units that were entitled creating a 200-unit property that would be more attractive to future purchasers. During the construction of the additional units Engel also implemented a value-add program on the original 160 units. This included new appliances, cabinetry, counter tops, hardware, lighting, and flooring. With the implementation of the value-add program and the new units Engel was able to realize rental increases in excess of $100. As a result of Engel’s ownership, management, and development of the property Engel was able to successfully position the property to be marketed and subsequently sold in September of 2018. As a result of the sale Engel was able to see a return of 24%.