Investment Summary and Strategic Location
Azalea Garden Apartments presents a stabilized investment opportunity in the heart of the Hampton Roads metropolitan area, a region home to over 1.7 million people. The property is offered at a target price of $2,000,000, representing a competitive price of $100,000 per unit. Residents benefit from a transit-oriented location with immediate access to I-64, I-264, and Granby Street, ensuring a short commute to the region’s primary economic drivers. The asset's proximity to Norfolk International Airport, IKEA, and the Simon Premium Outlet Mall—all within a 10-minute drive—guarantees consistent housing demand from a diverse and growing workforce.
Robust Economic Drivers and Growth
The Norfolk rental market is anchored by the world’s largest naval installation, Naval Station Norfolk, and the historic Norfolk Naval Shipyard. These institutions, along with major employers like Sentara Healthcare and Norfolk Public Schools, provide a bedrock of economic stability and a continuous stream of potential tenants. Furthermore, the region is undergoing significant transformation through massive infrastructure and entertainment projects, including the $3.9 billion HRBT expansion and the upcoming $350 million Atlantic Park development, which are expected to further bolster local property values and residential desirability.
Financial Performance and Value-Add Potential
Currently operating at a 5.90% cap rate, Azalea Garden Apartments offers a clear path toward significant revenue growth through strategic management. While current average rents sit at $1,015, market analysis suggests a potential market rent of $1,200 per unit, allowing an investor to achieve a Pro Forma Cap Rate of 8.83%. The financial analysis indicates that by optimizing economic occupancy to 90% and capturing the gain-to-lease potential, the Net Operating Income is projected to climb from approximately $118,066 to $176,534. This asset is ideal for investors seeking a high-yield, manageable multifamily property in a high-demand Virginia submarket.
Deal Highlights
Justin Ferguson is a Multifamily Specialist in Marcus & Millichap's Southern Virginia Office. He prides himself in helping corporate professionals, private investors, REITS, developers, and syndicators strategize and maximize their returns to grow their portfolios at faster, more efficient rates.