Lake Creek Village apartments sale nets Eagle County $50 million for workforce housing projects
On Tuesday, county commissioners approved sale to Denver-based firm
With the upcoming sale of the Lake Creek Village Apartments, Eagle County will net approximately $50 million to help finance construction of additional workforce housing units.
On Tuesday, the Eagle County Housing and Development Authority entered into a purchase and sale agreement with Tralee Affordable Mountain LLC of Denver for the sale of the 270-unit Lake Creek Village Apartments in Edwards. The purchase price is $81,850,000, and the county estimates its net profit at $50 million.
As she introduced the resolution to approve the deal, Eagle County Housing Director Kim Bell Williams stressed that the anticipated funding was only one of the objectives for the final sale contract. The other, she noted, was to provide assurances to current Lake Creek Apartments residents that the property would continue operation as an affordable complex. The agreement will require the future owner to maintain rental rates at 75% of area median income to include utilities and fees.
“One of our biggest concerns in doing this was trying to reassure residents that things will be OK,” noted Commissioner Jeanne McQueeney. The Tralee representative at Tuesday’s hearing noted that along with the agreement that rental amounts will remain at a maximum of 75% of AMI in perpetuity, the company will also bring a healthy capital reserve and future investment into the property.
“We are basically affordable housing owners. This is what we do day in and day out,” said Mike Kelly of Tralee Affordable Mountain LLC.
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Kelly noted that nationally, the renewal rate for rental units is 55% but Tralee’s renew rate is 80%.
“We try to make it so that residents never have a reason to leave our assets,” Kelly said. “The property will be run very well. Your residents will be very happy.”
‘Very popular’
The property was listed for sale in June with Colliers International.
“Immediately we discovered it was very popular,” Williams said.
The listing received a high level of interest from buyers with 251 confidentiality agreements signed by interested buyers. There were 37 on-site tours and 31 purchase offers. Williams said the housing authority determined Tralee’s offer most closely aligned with the county’s affordable housing goals with the highest investment into the property. Tralee currently owns affordable communities throughout the Mountain regions, as well as Florida and Texas.
Williams said the housing authority has done extensive outreach to current Lake Creek Apartments tenants regarding the proposed sale and will continue a partnership with Tralee after the deal is completed. Additionally, she noted the county studied a refinance of the property before deciding that a sale would be a better alternative.
Lake Creek Village Apartments was built in 1993 and includes 30 one-bedroom units ($1,225 per month), 152 two-bedroom units ($1,475 per month), and 88 three-bedroom units ($1,700 per month). The rental rates include utilities. Approximately 975 people live at Lake Creek Village Apartment, and a consistent waitlist remains from six months to two years, with the three-bedroom units being the most desired unit type.
Freeing up capital
Commissioner Matt Scherr noted the sale would allow the county to take advantage of the current conditions in global finance to release equity and ultimately provide even more affordable housing in the community.
“Our goal with this sale is to increase affordable housing options for Eagle County residents,” said Commissioner Kathy Chandler-Henry. “Partnering with Tralee means our current residents taking advantage of affordable housing rents won’t be displaced, while at the same time the county will increase its ability to provide additional affordable housing.”
“Lake Creek Village has kept downward pressure on rents, which is critically important for the county’s everyday workforce and residents,” McQueeney said. “This transaction will help us continue to apply pressure on rental rates to create affordable housing opportunities throughout the county.”
The Eagle County Housing and Development Authority will invest the equity from Lake Creek into new workforce housing development and acquisitions throughout Eagle County. The goal of the county housing authority is to provide innovative, affordable housing solutions to the working people, elderly and disadvantaged members of the Eagle County community.
The sale is slated to close in late January.
