New Haven/West Haven/Wallingford, CT
The New Haven County Portfolio offers investors the opportunity to take a substantial position in one of Connecticut’s most dynamic rental markets. Greater New Haven has demonstrated consistently high rent growth and low vacancy throughout the current cycle, while absorbing significant new luxury apartment construction. The New Haven County Portfolio, provides a new owner with scale for immediate operational efficiencies including marketing, management, and maintenance. The properties are extremely well located within the desirable New Haven, West Haven, and Wallingford rental submarkets and are comprised almost entirely of post-war brick construction. This collection of assets is primed to sustain long term rent growth and durability of cash-flow. Current, and projected, portfolio rents in renovated units are well below top-of-market new construction rental options, while offering larger floorplans and comparable unit finishes. While the new product continues to raise the ceiling for rental market pricing, the relative value offered at The New Haven County Portfolio positions it for sustained rent growth.
The New Haven County Portfolio was accumulated by the current owner from 2014-2016 in four transactions from legacy owners. The current owner immediately began to implement a unit renovation program across the portfolio. The current owner has spent over $2.3MM on capital items including unit renovations and deferred maintenance since acquisition. In 2016, the owner’s strategy shifted and the unit renovation program slowed. A new owner will benefit enormously from the opportunity to revive this strategy while entering assets with limited deferred maintenance. With the achievement of higher rents for renovated units, proof-of-concept for the value-add strategy is clear. The remaining unrenovated units offer investors over $700,000 in projected revenue growth in the near term.
The New Haven County Portfolio offers new ownership three options to capitalize on. Firstly, a new owner can choose to simply continue existing operations without the need for significant additional capital infusion. Secondly, a more opportunistic operator can choose to deploy a portfolio-wide renovation program and aggressive leasing strategy and take advantage of the sizable loss-to-lease that resulted from the incomplete repositioning. As a third option, an investor can choose a rolling renovation strategy, out of cash-flows, for a more gradual value-add implementation. The portfolio is extremely insulated from any downside risk with its low entry cost of $128/sf, remarkably below replacement, in one of the Northeast’s most desirable submarkets. Whichever strategy is chosen, The New Haven County Portfolio is priced to be cash-flow positive at acquisition.
New Haven County is located in south-central Connecticut in the New York Metropolitan area and has a population of 860,435. As of 2016 the median income per household was $62,715. Some of the county’s top employers consist of Yale University, Yale New Haven Hospital, United Illuminating Company, VA Connecticut Healthcare, and Quest Diagnostic. New Haven County is conveniently located to surrounding economic hubs like New York City, New York (70 Miles), Boston, Massachusetts (120 Miles) and Hartford, Connecticut (24 Miles). New Haven County benefits from easy access to NYC and Fairfield County via I- 95 or the Metro-North train system. I-91 provides a route to both Hartford and (via I-84) Boston. It is home to a number of institutions of higher learning, most famously Yale University. New Haven County provides residents with options to live in metropolitan cities such as New Haven and suburban communities such as Cheshire or Wallingford.
New Haven/West Haven/Wallingford, New Haven County, CT