Indy Student Housing to be AuctionedPosted: Updated:
A student housing complex near the Pyramids Office Park in Indianapolis will be up for auction next month. The property, which is leased by The Art Institute of Indianapolis and other colleges and businesses, will have a starting bid of about $1.7 million.
April 15, 2015
Chicago, Ill. -- CBRE Auction Services announced today that it has been retained to auction a student housing complex located in northern Indianapolis at 3553 Founders Road, Indianapolis, Indiana, in an online auction. This 220-bed student housing complex comprises 11 buildings that include 88-units with full kitchens of various configurations plus one public building that includes a lobby, fitness facility, offices, a relaxation area, and a 132-stall parking lot. The complex was constructed in 1983 as a Residence Inn Hotel and was converted to student housing in 2012 after a $2 million renovation of the property. This property will be sold in an online auction on Wednesday, May 20, 2015.
According to Douglas Johnson, managing director of CBRE Auction Services, "This well-located property in College Park will appeal to student housing and hotel investors. The property is currently generating strong cash flow as a student housing concept. However, given the positive hospitality climate for extended-stay hotels in the local market area and the interest we have received from major hotel flags, this property could also be converted back to an extended-stay hotel in the future and perform extremely well."
The Art Institute currently leases a minimum of 100 beds in the complex with an option to extend their bed count as well as their lease from October 1, 2016 to September 30, 2018. In addition to The Art Institute of Indianapolis, the property draws rental potential from more than 15 other colleges and businesses that are located near the property.
The asset has previously demonstrated its ability to perform as a competitive hotel in the local market and is in a prime position to capture the upward trend of the lodging market. Indianapolis hotels have experienced RevPAR growth of $17.16, or 39% from 2010 – 2014, according to the PKF-HR: March-May 2015 Horizons Report. This growth is expected to continue into the foreseeable future, according to the same report, indicating RevPAR gains of 7.2% and 5.3% in 2015 and 2016, respectively. According to Nate Sahn, Senior Vice President, of CBRE Hotels, "When the property was operating as a Residence Inn by Marriott, it generated $2.2 million in revenue with a Net Operating Income of $607,000. It would be a straightforward process for an investor to convert the property back to an extended-stay hotel."
The property will be sold in an online auction on Wednesday, May 20, 2015. An initial earnest money deposit of $100,000 is required in order to participate. Property inspections will be held by appointment only. CBRE representatives will be available to answer questions about the auction process, procedures, as well as the property.
Detailed property information will also be available for review including the purchase and sale agreement. For this, and other information about the auction, including the terms and conditions of the auction and a brochure, prospective bidders should visit www.cbremarketplace.com/3553FoundersRoad or call CBRE Inc. at 800-815-1038.
Source: CBRE Group Inc.