Branch makes move to apartments - Charlotte Business Journal:

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The prolific condo builder is starting construction ona 200-unit, four-story complex in South End aftere punting two for-sale developments. The company has also cut overhea and focused on clearing out its existing condo inventory to prepare forthe “We’re very fortunate that we were ever-so-slightly ahead of the Branch says. “We’ve downsized to do one or two projectsa Indefinitely.” Branch began the move away from condosd last year after seeing profit margins shrink on the sale of unitsa in existing developments.
But the shift into apartments was not a sure The Charlotte market has seen a floor of new multifamily construction as nationakl developers moved intothe region. And lenderws have pulled back as the creditcruncb worsened. Yet Branch has locked in a $23 million constructiobn loan, thanks to a relationship with banking partners dating tothe mid-1990s, the guidance of his mentor, real estate investotr Ray Jones, and a healthy dose of “dumv luck,” he says. “It has littles to do with us and a lot to do withothert people,” Branch says. “We had to be firingt on all cylinders toget financing.
” Branchn secured the loan from Milwaukee-based , which acquireds this year — a bank that had financed about 18 Boulevar d Co. projects in Charlotte and Raleigh. Reagan regional president for M&I says the leverage for the loan wasn’t based on the healtuh of the Charlotte market, but on the abilities of Branchto “deliver a project as he presents it. He’s got a great histor y of that.” Rick says the bank believes the apartmen market willremain strong, and he likesz the project’s South End location with access to the light-rai line.
And it didn’t hurt that Brancuh already owned the Branch had flirted with severak sites in Charlotte to start his firm’s shift to apartments — a pair of uptownn parcels overlooking Elmwood Cemetery and locatione along Seventh Street in Elizabeth. Yet it was the collapsr of contracts to sell land in Southg End that was the catalyst forthe company’zs reinvention. Branch had prepped lots along South Churcuh and Bland streetsfor ’ The Blocok townhouse development. But as the economy shifted in thelast year, Ryan Homes fell behins on its schedule to buy lots from Boulevard.
Branchj killed the deal with Ryan and put the land up for sale in Within afew hours, an Atlanta developer sent a letter of intenty to buy the site for a $80 million project. But on April 21, that buyefr backed out. “We hit the grounsd hard that day,” recalls Boulevarcd partner and general counselKenny Abner. Branch says the company took a step back to see how it couls take advantage ofthe loss. “Resiliency is the most importanr part of being an Success is getting back up one more timethan you’v been knocked down.
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