One of Hamilton County's biggest apartment complexes has a new name, owner and manager less than a year after its opening.
Southwood Realty, a Gastonia, North Carolina-based real estate investment and management firm, bought the 300-unit Ardmore Heights apartments in Ooltewah last week and renamed the complex Reflection Pointe on Friday.
In the biggest residential property sale in Hamilton County history, Southwood paid $79.2 million to acquire the Ooltewah apartments from another North Carolina real estate firm, the Greensboro-based Ardmore Residential Inc., which developed the complex and opened its first apartment units last fall.
"We are very excited that Reflection Pointe Apartments is now under new ownership and management by Southwood Realty," the new owners said in a letter to tenants. "Over the next few weeks, our staff will work diligently to ensure a smooth transition."
Apartments in the former Ardmore Heights range from one-bedroom units renting for $1,375 a month up to a three-bedroom unit renting for $2,025 a month, according to site managers. The complex spans nearly 15.5 acres and has 340,482 square feet of buildings, according to Hamilton County property records.
The apartment complex was built on a ridgetop along Old Lee Highway and overlooks the Apison Pike exit on Interstate 75. The 300 one-, two- and three-bedroom apartments are grouped in nine three-story buildings, and the complex includes a swimming pool, fitness center, pet washing area, business center and community room and is only a few miles from Hamilton Place mall to the south, the Volkswagen and Amazon facilities at Enterprise South Industrial Park to the north and the city of Collegedale to the northeast.
The $79.2 million purchase is the biggest ever for an apartment complex in the Chattanooga area, topping the record set in 2020 with the $63.15 million sale of the Blue Bird Apartments near the Chattanooga Choo Choo.
The purchase price paid by Southwood Realty is equal to more than $260,000 per apartment, although the sale also includes prime property along Old Lee Highway that could be developed for commercial or restaurant businesses. The per-unit price paid for Ardmore Heights topped the previous record high for a major apartment complex in Chattanooga set by the Blue Bird, which sold three years ago to a San Francisco-based investment group, Hamilton Zanze.
Offiicals with Southwood Realty, which has grown since its start in 1977 into one of the largest apartment management companies in the Southeast, did not respond Tuesday to questions about its purchase of Ardmore Heights. Residents at the newly renamed Reflection Pointe in Chattanooga said only about half of the 300 units are now occupied as the new apartments continue to be marketed to prospective tenants.
Growing supply and demand
The 300 apartments at Reflection Pointe are among an estimated 4,800 new units added to the Chattanooga market in the past five years, representing 18% of the market's existing apartment stock, according to a new study of the Chattanooga multifamily market by the real estate consulting firm CoStar Group.
"Chattanooga has been a hotbed for multifamily construction over the past several years," CoStart said in a new market analysis released last month. "Developers have been targeting Chattanooga for its appealing demographics and economic growth, and about 980 units are under construction, representing roughly 3.5% of the metro's inventory."
Chattanooga's apartment market "is facing a wall of supply amid a period of improving demand," the CoStar report said.
"Yet that improvement from the demand perspective still has not been enough to offset the sheer number of units that have opened their doors in recent quarters," said CoStar, which put the market's apartment vacancy rate at 8.7%.
Chattanooga's multifamily market still remains stronger than in most cities. A separate study of rental rates by the online leasing site Zumper said Chattanooga rental rates continue to increase faster than in most other cities, but housing costs in the Scenic City still remain more than 12% below the U.S. average.
In the past 12 months, the average rent for a one-bedroom apartment in Chattanooga increased 8.2% to $1,320 a month, while the rate for two-bedroom apartments in Chattanooga jumped by 18.3% over the past year to an average rent of $1,550 a month, Zumper reported last week.