| CREOP

About the Property

This investment opportunity features a 155-key Ramada hotel in the midst of a transformation into a Wyndham Garden hotel, located on a spacious 3.28-acre site. Currently, renovations are being carried out on half of its 8 floors, set to complete before the sale concludes, ensuring a modernized facility from the start. Each unit spans 325 square feet, ideal for conversion into multifamily apartments. The seller's commitment to resolving any liquidity debt with Wyndham Garden simplifies the transition for the investor.
The property is not just about its size or potential for apartment conversion; it also offers unique amenities including a swimming pool, ballroom, and commercial kitchen, making it highly attractive for future residents. Built in 1973 and undergoing a significant upgrade, this investment stands out for those looking to make a mark in the multifamily segment, combining the appeal of modern living with the charm of unique, hotel-style amenities.

Smith Reynolds Airport SubMarket

The multifamily property market near Smith Reynolds Airport has experienced a notable shift in dynamics over the past year. Historically, investors have actively pursued acquisitions in this area, but the trend halted in the last 12 months with no properties changing hands. This pause in transactions comes amidst a broader context of price adjustments and yield changes.
As of the first quarter of 2024, the market pricing for apartment properties in the Smith Reynolds Airport vicinity was estimated at $75,025 per unit. This represents a decline from previous levels, indicating a year-over-year decrease in property values. Such a dip places these assets below the average market value compared to the wider Winston-Salem metropolitan area, suggesting that properties in this specific submarket may be undervalued or experiencing a temporary market correction.
The market capitalization rate has slightly increased to 6.3% over the past 12 months. This increment reflects a modest rise in investment risk or a recalibration of expected income from these properties. Nevertheless, the current cap rate aligns closely with the metro average, though it surpasses the submarket's five-year average cap rate. This could signal a normalization of returns, aligning more closely with broader market conditions, despite the recent price adjustments.
Overall, the Smith Reynolds Airport multifamily property market appears to be in a period of reassessment, with price corrections offering new opportunities for investors. The alignment of cap rates with metro averages also suggests a stabilization in investor expectations, despite the recent market inactivity.