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The Oaks Apartments

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The Oaks Apartments

Investment Information

Address: 101 Arbor Run Drive Lincolnton, NC 28092
Asset Class: Multifamily, Conventional
Size: 111 units
Year Built: 2002
Acquisition Date: July, 2018
Acquisition Cap Rate: 6.09%

Financial Performance:
Original Capital Investment: $2,895,000
IRR: 32%
Equity Multiple: 3.77X

Market Overview:
Lincolnton, NC is a bedroom community located 37 miles northeast of Charlotte, and part of the Charlotte MSA.

Located between the Blue Ridge Mountains and coastal plains, the Charlotte metro stretches 3,198 square miles across the Piedmont region of the Southeastern United States. It contains seven counties in North Carolina: Mecklenburg, Gaston, Union, Cabarrus, Iredell, Rowan and Lincoln. South Carolina counties include York, Lancaster and Chester. A strong financial presence has contributed to the local population growing to more than 2.4 million citizens, becoming one of the nation’s fastest growing metros over the past 15 years.

Charlotte currently boasts a population of over 800,000 people. The Charlotte metro is expected to gain 18% population growth over the next 7 years. The largest portion of this gain will be due to in-migration.

Charlotte has a well-educated and highly trained labor pool that is attracted by a variety of industries and employers located in the metro. The metro’s employment base is growing and diversifying, drawing Fortune 500 companies. Though the finance sector is a large driver of the economy, manufacturing, healthcare and energy industries also play a vital role. The low cost of doing business attracts companies. Eight Fortune 500 companies have headquarters in the region: Bank of America, Lowe’s, Quintiles Transnational Holdings, Duke Energy, Family Dollar, Nucor, Sonic Automotive and Domtar. Highly ranked universities provide employment and produce a highly educated workforce, drawing top companies to the area.

Property Description:
The Oaks is comprised of 8 two story garden style buildings spread over 10 beautifully landscaped, wooded acres. Built in 2002, the Oaks stands as Lincolnton’s premier apartment community. Unit mix is comprised of 20-1BR/1BA, 79-2BR/2BA, and 12-3BR/2BA Units. Property has covered balconies and breezeways, and 230 parking spaces, including fully enclosed garages. Amenities include Clubhouse, Fitness Center, Onsite Laundry as well as en-suite laundry hookups, Basketball Court and Dog Park.

MPC Strategy:
McKee Private Capital acquired the Oaks from its original developer in July of 2018. While the property had been well maintained physically, it had been undermanaged as demonstrated by high vacancy. A more aggressive leasing campaign was implemented resulting in NOI growth in excess of twenty percent within the first year of ownership. In Spring of 2022, ownership made the decision to divest the asset resulting in a return of equity four times over.