The Warehouse apartment complex, a popular off-campus housing location for students at UNC, has recently been sold to a new developer.
The Preiss Company, a student housing real estate investor based in Raleigh, recently acquired the apartments from the previous owner, New York City-based Clarion Partners.
Adam Byrley, the Preiss Company’s chief operating officer, said the company always wanted to invest in Chapel Hill, as the company’s founder and CEO Donna Preiss is a UNC graduate. In addition, Byrley cited a prominent student housing market as an incentive for the deal.
“The present-day student housing market in Chapel Hill is extremely strong, and it made lots of sense for us to own property here," Byrley said in an email. "When the Warehouse opportunity arose, we jumped at the chance to have a class A property that is walking distance to campus.”
Matt Gladdek, executive director of the Downtown Chapel Hill Partnership, said the sale accentuates demand for off-campus housing that is walking distance from the University, such as Granville Towers, The Courtyard Lofts, Shortbread Lofts, Carolina Square and other nearby apartments.
“Especially in downtown where I track all of the leases, there are no available units anywhere in downtown," Gladdek said. "You know, we have some vacancy in our office and in our retail (units), but our residential is full, and the rental rates for those available units are going up year to year. I think it is a very clear indication of the high demand for these types of units."
Gladdek said he did not expect any large changes to be made to the Warehouse property other than minor updates and improvements that are standard in apartment deals. He said sales between ownership companies are a common practice, as seen by the sale of The Courtyard Lofts on West Franklin Street earlier this year.
“Companies will buy an asset and hold onto it for a certain number of years, and then they sell it and take their money and split it with their investors and they’ll reinvest it elsewhere," Gladdek said. "And that’s just a pretty standard practice."
Byrley said the Preiss Company has big plans for the Warehouse apartment space, including upgrades to internet and cable packages, amenity spaces and the rooftop lounge. In addition, he said the Preiss Company will be revealing an in-class resident life program called COACH that will provide opportunities for residents like building career services and life skills, fostering social wellness and creating opportunities for outreach in the community.
Caroline Le, a junior at UNC and current resident of The Warehouse Apartments, said she is excited to see some of these changes implemented.
“The new management hasn’t told us much, but they did promise a lot of new renovations and updated amenities coming in the near future,” Le said.
Le said an amenity that has already been installed is a new complimentary coffee bar in the lobby, and she looks forward to the renovated rooftop lounge and upgraded Wi-Fi in the future. However, she said these new amenities don’t come without a cost.
“Because of all the renovations and with new management going in, our rent for the next leasing period next year increased significantly,” Le said.
Byrley said the Warehouse apartment rent is not above the market average, and the Preiss Company believes the apartment complex is of high value within the current market.
“We hope to allow a lot more value in the near future that will continue to make the Warehouse a top choice for students at Carolina,” he said.
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