Northland buys targeted Pasco apartment

Northland Investment Co.'s $52.87 million deal for a 14-building, 311-unit apartment complex in Land O'Lakes, on its surface, appears to be just the latest deal in a Gulf Coast multifamily buying spree that shows no signs of abating.

But the Newton, Mass.-based company's decision to acquire the Village at Terra Bella could signal an inflection point in the market.

That's because Northland, a company that already owned more than two dozen Gulf Coast complexes from Fort Myers to Tampa, targeted Pasco County because of its high “affordability ratio.”

“Like a lot of investors, we're focused on high-growth areas, particularly along the lines of white-collar employment, and Pasco and the Tampa suburbs certainly have that,” says Matthew Gottesdiener, Northland's chief investment officer. “But what we like about that area, too, is that a majority of tenants are comfortably able to afford their rent.

“Buying there is absolutely a reflection of how we see the market today,” Gottesdiener adds. “We've seen such a massive run up in prices, and a compression of cap rates, especially in downtown and more urban areas.”

He explains the firm also liked Terra Bella because of its age. It opened last year.

“We tend to be long-term owners, holding properties anywhere between 10 and 25 years,” Gottesdiener says. “So we focus on newer built communities.”

In all, Northland has spent more than $630 million in Florida since 2008 to acquire complexes containing 5,400 units. Last month, the company also was ranked by the National Multifamily Housing Council among the Top 50 owners of apartment communities in the U.S., with 24,212 units.