Apartments are being built but the rent may be challenging.
The LPGA/Williamson area near Ormond Beach was described as “the hot corner” by Larry Bartlett, Volusia County property appraiser, at the annual VCARD Real Estate Values Forum on June 7 at Halifax Plantation Golf Club.
“This is where the growth is happening,” he said.
There’s not only retail growth, but also residential. Along with Margaritaville and Mosaic communities under construction, two new apartment buildings have been built in the area, Sands Parc, 264 units; and Tomoka Pointe, 276 units; and one is under construction, 500 East with 301 units.
The demand for apartments is increasing, Bartlett said, because many people, particularly millennials, want to remain mobile. The downside, he said, is that neighborhoods of single-family homes are more stable and pay more property tax.
Another guest speaker at the forum was Luke S. Wickham, senior vice president at CBRE Group Inc., a national company involved in multi-family real estate.
He said no apartments were built in the Daytona Beach area between 2009 and 2015, and job growth has created a demand. Even with increasing rents, apartment complexes are finding renters. He cited the two hospitals as employers supplying renters for luxury apartments.
According to rentcafe.com, the average rent is lowest in South Daytona at $1,015 per month and highest in Port Orange at $1,193 and Ormond Beach at $1,181. But the rent for a two-bedroom apartment in Tomoka Pointe, a Class A luxury apartment in the hot corner, starts at $1,450, according to www.tomokapointe.com.
According to a statement from VCARD, there are an estimated 4,500 apartment units now in the development pipeline, with almost all in the Class A luxury category.
Wickham said a person should earn three times the rent to afford an apartment, or possibly 2.5 times.
To supply properties with lower rent, Wickham said it would be necessary to construct an apartment building using tax credits and government grants, because of the cost of construction.
A work-force housing project was planned in Ormond Beach a few years ago west of Interstate 95, but the developer could not get tax credits. An extended-stay hotel is now being built on the lot.
MARGARITAVILLE HAS NEW OFFERING
As many as 3,400 homes could be added in future years to the “hot corner” as Latitude Margaritaville develops near the intersection of LPGA Boulevard and Tymber Creek Road. The new community took on the true spirit of its name June 8 when hundreds of people, both residents and visitors, enjoyed cheeseburgers in paradise, danced and socialized with a laid-back attitude at the grand opening of Latitude Center, the gathering place for the community.
Originally, plans called for Phase 2, which would continue Margaritaville north to State Road 40. But Minto, the developer, backed out, citing increased impact fees and other costs, and the land north has since been purchased from Consolidated Tomoka by another developer who has not been named.
There was anticipation of Tymber Creek Road being extended all the way to S.R. 40, and this will likely still happen, because there is an agreement with the county that when developed, the landowner will extend the road. Margaritaville is extending it to the north end of their property.
When Margaritaville began selling lots, the prices started at $225,000, but they are now start around $250,000. Bill Bullock, president of Minto’s Latitude Margaritaville Division, cited the cost of labor and materials.
But he said they have introduced a new model, the Conch Cottage, so they can once again offer a model closer to $200,000.
“We’re nimble,” he said. “We can adjust to the market.”
About 700 total homesites have been sold.
Another new wrinkle is that a prospective buyer can rent a villa for three days to see if they like the community.
Bullock said at the grand opening that after showing brochures and renderings for months, he enjoyed seeing the happy expressions on the faces of the residents as they saw the completed Latitude Center, which includes a bandshell, fitness center, large swimming pool, restaurants and bars. There’re also tennis and pickleball courts and a nature trail and more amenities are planned. A Publix-anchored retail center is being constructed only a golf cart ride away.
MOSAIC ALSO BUILDING
About three miles west of Interstate 95 on LPGA Boulevard is the entrance to Mosaic Communities, the other new housing development under construction near the LPGA/Williamson area.
There are no age restrictions, with the development promoting a family-friendly, multigenerational atmosphere. The website states the homes start in the mid-$200s. There is a potential for 1,200 home sites, and there are now two builders with their own sales centers in the development, ICI Homes and Adley Homes.
The clubhouse and swimming pool are expected to be complete at the end of the year, but there is already an activities director for residents, according to Ruschel Miranda, ICI sales associate.