An Atlanta real estate firm has joined with a partner to purchase three apartment complexes totaling nearly 500 units on Six Flags Drive for just over $19 million. H.J. Russell & Co., with the help of a New York City partner, has acquired the 144-unit Parkview Atlanta at 360 Six Flags Drive, the 146-unit Kingsley Village at 595 Six Flags Drive and the 200-unit Hunter’s Grove at 575 Six Flags Drive.
All of the properties were built between 1978 and 1987, according to the buyers. Although they are older apartments, they were recently refurbished by the previous owner, Atlanta-based QR Capital, and have an average occupancy rate of 90 percent, bringing in rents of $500 to $700 a month, said Rod Mullice, senior managing director with Newmark Grubb Knight Frank, which represented the buyer in the transaction.
Mullice said the three complexes, though foreclosed upon a few years ago, are no longer considered underperforming properties.
“These properties were foreclosed upon in 2009 and 2010 and the previous owner put in $1.2 to $1.3 million to upgrade these properties physically,” he said. “So these are strong communities that have been renovated.”
Jerome Russell, president of H.J. Russell & Co., said he’s been eyeing the area for some time but this is his firm’s first foray into Cobb County.
While south Cobb has become an area with higher crime rates and lower rents than other parts of Cobb County, the school system is still considered one of the best in the state and the partners said they saw potential to lift the Six Flags area up. “I’ve been looking at doing some business in Cobb for a while. I feel like there’s opportunity there,” Russell said. “Our business is based in Atlanta and we own and manage all over the state of Georgia, Florida and South Carolina, but the majority of our base is in Georgia and metro Atlanta.”
H.J. Russell is a family owned real estate business founded in 1952 by Herman Russell that owns more than 7,300 apartment units in several states, according to its website. The firm is recognized by Black Enterprise as one of the Top 100 African American Owned Companies in the United States. The Russell family partnered with New York Citybased Civitas Communities on the Six Flags Drive deal.
“When we started looking at this opportunity, we liked it because it’s in Cobb, it has proximity to I-20 and to Buckhead, the Galleria, and as an existing employment center and the whole industrial area there,” Russell said. “You have Six Flags as an anchor and also Word of Faith Church. I saw a lot of upsides there.”
Possible new development on the horizon?
Along with becoming a major owner of real estate, H.J. Russell also serves as a builder, developer, contractor and property manager.
“We’re fully integrated,” Russell said.
Russell hinted that the company may use some of those other skills in the Six Flags area. “These communities are literally right down the road from the Six Flags amusement park. We’re going to enhance the value of these assets and perhaps develop additional properties along that corridor,” Russell said.
“We’ve had some very preliminary discussions to look at some other opportunities there, very preliminary, but clearly there is a desire, with that road being named Six Flags Drive, to improve the overall amenities in the area whether it’s hotels, retail or more residential. So we’re just going to continue to work on it, because if all that improves it improves the value of the apartments.”
But the first step will be to learn as much about the community and find out how it can help and support its residents, he said.
That will likely involve working with area churches and nonprofits, whether that be through after-school programs, special events or programs.
Partner also on board
Derek Bark, with Civitas Communities, said the partners have all bought into the same “community-building” strategy.
“Our strategy is to go in and really invest in the communities from a services perspective, where we do after-school programming, summers programming and partnering with nonprofits to create a space where families feel like their kids are being taken care of,” Bark said.
“We’ll be working to build the community and make it a better place for people to live and where people are willing to move here and pay a little bit higher rents. Our goal is to make it a better rental experience.”
Mullice said the rents are already outperforming the average for the south Cobb submarket as a whole.
“And with the additional focus on community activities, retention and rents should be moving north,” he said.