In hindsight, August 2008 probably wasn’t the best time to open a new apartment complex. One month later, the financial crisis hit, and the shockwaves soon rolled through the apartment industry. But Dallas-based Trammell Crow Residential’s project, Alexan Fitzhugh, may have been built to weather the storm. The three-story, 452-unit community sits in a transitional Dallas neighborhood 10 minutes from downtown, but it has features uncommon for developing neighborhoods. The Alexan Fitzhugh has four interior courtyards (three of which have large swimming pools), a two-story fitness center, and three large parking garages that integrate seamlessly into the property. All units feature upgraded amenities including brushed nickel fixtures, granite countertops, stainless steel appliances, faux wood flooring, ornate crown molding, and a colored accent wall. The exterior is a combination of stone, stucco, furnished block and siding, and takes cues from the surrounding neighborhood structures.
These features helped the project win “Best Garden Apartment Community” (for development four stories and under) at the 2009 Pillars of the Industry Awards from the National Association of Homebuilders (NAHB). In addition to Trammell Crow, those honored include the architecture firm Beeler Guest Owens, interior designer Faulkner Design Group, and JBI Partners landscape architecture.
Darren Schackman, Trammell Crow Residential's senior managing director, took time to talk with MULTIFAMILY EXECUTIVE about the genesis of the project and how it’s fairing in today’s rocky economy.
MFE: What was in the neighborhood where you built the Alexan Fitzhugh?
DS: It was a transitional neighborhood just east of Central Expressway on Fitzhugh Avenue. We bought up approximately 10 acres of very old, dilapidated existing apartment complexes, leasing those down, and we then razed the site and built Alexan Fitzhugh on it.
MFE: Was assembling the site difficult?
DS: We were dealing with two separate sellers. Inherent in that, we had some challenges in getting contracts and everybody agreeing to work together. But we were very successful. We had a couple of sellers that understood the situation and worked with us.
MFE: Was building a luxury project with high-end finishes your plan from the start?
DS: It was. We are in a neighborhood that’s transitioning, but we are extremely close to City Place and uptown areas and downtown. We wanted to be sure to match, if not beat, them with our product. The idea was to come into this area, give renters everything they would ever want, and provide them a reason to come to the Alexan Fitzhugh. Our rents are less expensive than City Place, uptown, or downtown, but we believe renters get better quality and higher-end amenities at our project while having a lower monthly cost.
MFE: Despite the fact the neighborhood was transitional, was it difficult to get the development to blend in?
DS: It actually has a beautiful older established neighborhood that it’s adjacent to. In working with BGO, our architect, we took a great amount of time to really make it fit. The project is approximately 10 acres, so it really has a big impact on the area. The team took a tremendous amount of time to build a neighborhood appropriate project.
MFE: What are some of the things you did so it fit ub architecturally?
DS: We used a lot of brick and stone and tried to gear it towards a shaker-style development. That being said, we also added some flair to attract our target market. I think we were successful in doing that. We based it mostly on the architectural style of a neighborhood that’s across Fitzhugh from us. It’s an older, established neighborhood, but it’s going through some transition as well. We tried to bring the core behind the neighborhood into our development, architecturally.
MFE: What were some of your major challenges with this project?
DS: When we purchased the property, it was at a time when land values were relatively high. We were held to a three-story project height by zoning regulations, so we needed to increase the density. In a typical three-story garden deal, you get 20 to 25 units to the acre. It’s a lot of concrete, since it's surfaced parked. We did a three-story product and incorporated structured parking, which got our density to a little more than 45 units to the acre. Plus, it’s a great amenity for the residents because they have a secured, structured parking facility. Also, it is great for the residents because they have the convenience of parking on the same level as their units.
We also have a public street separating the project. The public street really doesn’t go anywhere. It Ts at the end of our project. There really isn’t a whole lot of traffic running up and down that street. What we decided to do was pull the clubhouse off of the high-traffic corner and put it in the middle of the project to really try to create our own neighborhood. Since we have 452 units and 10 acres, we were able to do that. When you pull down the street to get to the clubhouse, it really feels like you’re in a completely different neighborhood.
MFE: Given the neighborhood, were you worried about overshooting the market?
DS: We felt the market was there. That being said, our rents are actually in line with our competitors. Then, when you go over to uptown and downtown, our rents are dramatically lower.
MFE: How has leasing at the Alexan been going?
DS: Very well. We are giving concessions, as is everybody. It depends on the floorplan. That being said, leasing has gone extremely well. We’ve averaged between 25 to 30 units leased a month.
MFE: What floor plans are doing better in this economy?
DS: It’s all over the board. Generally, the two-bedroom units in this type of product go a little slower. But because of the economy, we’ve had a lot of roommates. So those are actually doing very well.
MFE: How are you feeling about the project's loan situation? Do you have any maturities coming due?
DS: We’re actually in pretty good shape, but like everybody, it’s a concern. We have some time before we have to make these decisions (about permanent financing). Certainly there are some challenges with the economy, but the project is holding its own and doing well. We’re very happy.