5th and Main Condos in Nashville Sold to ACG Equities

Vinings Main Atlanta

5th and Main condosChicago based ACG Equities has purchased the struggling 5th and Main condo development in East Nashville. The completion of the sale came Friday morning at 11:00am during a ‘special auction’ when ACG Equities purchased the 120 remaining residential condos for $9.33 million and 27,000 square feet of commercial space (17,000 retail – 10,000 office) for $1.87 million. It remains unclear whether ACG purchased the 2+ acres of undeveloped land as part of this sale.

While the ‘special auction’ price totals $11.2 million, this is not the complete consideration paid for 5th and Main. It is my understanding that Wachovia Bank sold the note to ACG Equities a couple of weeks ago and that the foreclosure sale was conducted on ACG Equities’ behalf. Assuming this is the case, the $11.2M bid likely has no relationship to what ACG Equities actually paid for the note, which is in excess of $12M. Based upon past conversations with Wachovia Bank asset managers, I would estimate the total consideration for the acquisition to be in the $14.5M to $15M range. Unfortunately, all of the documentation filed will reflect the price paid during the ‘special auction’, only deal insiders know the true total consideration paid.

This also explains why there were no additional bidders at Friday’s sale. 5th and Main was already under contract, the foreclosure sale was simply procedural and ceremonial in nature. This foreclosure sale cleared all remaining mechanics liens which were rumored to be nearly $1M.

What ACG Equities Will do with 5th and Main

If history is any lesson, I suspect ACG Equities will not convert the 5th and Main into apartments. Instead, they will slash condo pricing to around $145/ft and continue to sell the remaining 120 condos to the general public. It also seems probable that ACG will offer private financing terms to buyers until the project can once again qualify for FHA underwritten mortgages. I believe the current 50 renters in the building will most likely be allowed to stay through the end of their lease, but not be given an option to extend.

ACG Equities will also begin leasing the mostly vacant commercial space immediately, but not before they install a few much needed community amenities. I expect ACG will install a gym as well as a proper lobby/property management office. It seems very unlikely that a pool will materialize, sorry guys.

ACG Equities: Vinings Main Acquisition and Sale

Vinings Main AtlantaThis isn’t ACG’s first rodeo. Last summer ACG Equities purchased the Vinings Main development in Atlanta on June 30, 2010 for approximately $24 million. Built at a cost of $57 million and completed in 2008, Vinings Main was taken into foreclosure December 2009 by its 23 lenders, after having sold only 3 of its 148 condos. In additional to 148 condos, Vinings Main includes 36,000 square feet of office space and 17,900 square feet of retail space known as The Shops at Vinings Main.

Shortly after the acquisition, ACG slashed condo prices by more than $100,000 and began aggressively leasing the vacant commercial space. The next several months produced results, ACG sold roughly 20 residential condominiums, priced from $140,000 to $290,000. The original asking price range for these units was in the high $200,000s to the high $500,000s, according to ACG.

On December 29, 2010, just 6 months after its initial purchase, ACG sold The Shops at Vinings Main for $4,035,000. Approximately seventy-five percent leased at closing, retail tenants include Social Vinings, Snap Fitness, Subway, The Posh Spot and Vinings Main Cleaner.

ACG Equities: Who They Are

ACG Equities is a Midwest-based $150 million private equity fund. From their ACG Management website: ACG Equities, Inc., based in Rosemont, Ill., operates as a sponsor/operator specializing in value added commercial property acquisitions/dispositions for its private investors and equity funds. In addition to its Chicago area headquarters, the company operates from offices in the Atlanta, Denver and Minneapolis markets, and soon expects to open a Washington, DC, area office. Additionally, Principal Dave Lang is also listed as a principal or partner is DPL Ventures and Homeowner Advantage aka Novare Group.

H06 Condo Insurance – What is It, Do I Need It?

H06 Condo Insurance

H06 Condo InsuranceCondo insurance that bridges the gap in coverage between your condo association’s master insurance policy and your property/personal liability protection is known as a H06 condo insurance policy. If you are acquiring a mortgage in order to purchase a condo, your mortgage lender will most likely require you to purchase this policy.

Every condominium development has a master insurance policy that covers items such as the actual building in which you reside, all of the common area elements (pools, gyms, lobbies, etc) and provides worker compensation for those employed by the condo association (if any). However, these master insurance policies typically stop at the four exterior walls of your condo. This means that not only are your personal contents not insured by the master association policy, neither are any of the items within the four walls of your condo: cabinets, appliances, flooring, jetted tubs, etc. Moreover, many associations no longer cover the replacement of exterior windows, this is something you need to inquire about prior to purchasing a condo.

Each homeowners association is unique and each can have different rules pertaining to individual liability for damages due to fire, flood, or negligence. Many association by-laws require the owner of the condo in which the problem originates to be held responsible for adjoining unit damages, while others stipulate each owner will be responsible for their own damage no matter the original source. It is very important that your H06 condo insurance policy cover your complete liability based upon what your condo association by-laws and rules state.

Who Provides H06 Condo Insurance Policies

All of the large insurance companies do write H06 condo insurance policies (State Farm, Allstate, USAA, etc), but so do many of the smaller insurance agencies in your city. If you have car insurance or life insurance with one of these larger companies, they will typically discount your H06 insurance policy just as they would if you were to add an additional vehicle or perhaps fine art insurance. However, do not be fooled, many local insurance companies can beat the ‘big guys’ on both cost and coverage. Do not be afraid to shop all companies for your H06 insurance policy. Many times you will find better insurance for all of your needs during this process.

How Much a H06 Condo Insurance Policy Should Cost

H06 condo policies can be as inexpensive as $14 per month, but for the average condo in Nashville, your monthly expense is going to be closer to $25 – $35 a month. However, if you own a rather large condo, have fine art, very expensive furniture or other items that are unusually expensive, your policy cost will be higher.

Disclaimer: I am not within the insurance industry. The above information is a compilation of what I have observed and learned after selling more than 150 condos in Nashville, TN.

Additional Information From an Insurance Expert

Kevin Michelson with Liberty MutualKevin Michelson, MBA of Liberty Mutual points out a couple of condo policy add-ons that you should consider.

Loss Assessment: Provides coverage for your share of loss assessment charged against you by an association of property owners when the assessment is made as a result of direct loss to property owned by all members collectively or as a result of liability from property damage or bodily injury (subject to covered perils and exclusions).

Home Computer Endorsement: Liberty Mutual’s program covers $5,000 worth of desktops, laptops, smartphones and iPads for $20 a year and a $50 deductible rather than the standard policy deductible. This is a great alternative to Verizon or ATT’s plans.

Which Williamson County School Am I Zoned For?

current williamson county school zones

williamson county schoolsWith the recent drastic changes in the 2011 – 2012 Williamson County School zoning, it may be prudent to check if your home has been rezoned to another school. Several border neighborhoods have be rezoned multiple times over the past decade. This latest rezoning, preformed by Education Logistics, is touted to be a rather final Williamson County school zoning for the near future.

current williamson county school zones

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Williamson County School zoning 2011

Affected Neighborhoods in Brentwood and Franklin

Westhaven
Meade at Avalon
The Enclave
Carronbridge
Cool Springs East
Bonbrook on Concord
Fountainbrooke
Hidden Valley Estates

There are many more than the few listed above. If you would like for me to add your neighborhood, simply email me.

Edwin Keeble Designed Home in Hillwood, Cheap!

edwin keeble nashville architect

As many readers know, I like to point out homes that have intrinsic value and intrigue from time to time (not to mention you have the opportunity to purchase a 4,154 square foot home for under $130 per foot). An example of his early work, this 1947 Edwin Keeble designed home in the Hillwood area of Nashville is one of the first homes designed after Keeble struck out on his own. It is during this period that Keeble famously designed Nashville’s first modern skyscraper, the L&C Tower. The home does need some care, but with a new high-tech commercial roof, Trane air conditioning system and spectacular kitchen, I cannot imagine not jumping all over the chance to live in such a historically significant home.

Edwin A. Keeble, Nashville Architectural Icon

edwin keeble nashville architectEdwin Keeble was born into a distinguished Tennessee family. His father was an attorney and later the dean of the law school at Vanderbilt University. His paternal grandfather was a State Representative from Tennessee during the second Congress held in Richmond, Virginia, 1864-1865. Keeble attended Montgomery Bell Academy and enrolled in Vanderbilt University at the age of sixteen. After receiving his engineering degree from Vanderbilt in 1924, he studied architecture at University of Pennsylvania followed by France and finally Italy. He received his architectural degree from the University of Pennsylvania in 1928, at the age of twenty-three.

Keeble began practicing architecture in Nashville, and in 1929 his association with architect and engineer Francis B. Warfield established the firm of Warfield and Keeble, which existed until 1944. After a two-year term of service as a lieutenant in the United States Navy, Keeble established a private architectural practice in Nashville and designed many notable structures, including the Life & Casualty Tower, Woodmont Christian Church and Vine Street Christian Church.

Williamson County Ranks 3rd of 3,141 for Future Jobs

williamson county tennessee map

williamson county tnWashington, DC research firm Woods & Poole Economics, Inc. expects Williamson County to add 170,000 jobs over the next 30 years – more than all but two other counties in the United States.

Ahead of Williamson County are Loudoun County, Virginia and Douglas County, Colorado. Loudoun County is part of the Washington, DC metropolitan area and ranks as the #1 wealthiest county in the United States. Douglas County is part of the Denver metropolitan area and ranks as the #3 fastest growth county in the United States, increasing 64% in the last decade.

Current Williamson County, TN Rankings

According to the most recent data available from the U.S. Census Bureau, the current population of Williamson County is 171,452. While doubling the number of jobs in Williamson County may seem a tad farfetched, consider that the countywide population 30 years ago was a mere 59,975. The recent explosive growth of Cool Springs with the relocation of multiple Corporate Headquarters coupled with the highest rated public school system in Tennessee seems to suggest that we may indeed experience an era of outstanding economic growth.

Williamson County ranks as the #17 wealthiest county in the United States, #1 in the Southeastern United States and #1 in Tennessee. Boasting an increasing median household income of $88,316, Williamson County could jump to #12 on this list with a nominal $2,000 per household increase. This jump seems likely as much of the predicted job growth is in the white collar sector.

Williamson County ranks as the #68 fastest growing county in the United States, #1 in Tennessee – growing by 31% between 2000 and 2008. It seems fairly certain that Williamson County will continue to climb on this list.

williamson county tennessee map

Williamson County Real Estate Prediction

While it remains very difficult to predict the precise growth or decline of housing prices, volume, inventory and starts, it does appear safe to predict that Williamson County real estate should continue to recover over the next few years. The long-term outlook looks quite bright as you consider the next 30 years of predicted job growth, but the short-term outlook also looks healthy  – Williamson County ended 2010 with home sales 15% higher than in 2009.

High-end neighborhoods like the Governors Club and Annandale in Brentwood each recorded 2010 sales higher than each of the previous 2 years. Mid-range neighborhoods like Fieldstone Farms in Franklin and Chapman’s Retreat in Spring Hill also experienced year over year price and sales increases.

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