An apartment project with a price tag north of $100 million plans to kick off construction this summer on one of the few remaining undeveloped lots in downtown Durham.
Charlotte-based Lennar Multifamily Communities (LMC) — the apartment building arm of the Miami-based home builder Lennar Corp. — will build 356 apartments on a four-acre parcel of land at 425 S. Roxboro St. The six-story building will also have nearly 7,000 square feet for either retail or restaurant space.
That parcel of land is sandwiched between two large-scale developments that are already underway or completed near the Durham Bulls Athletic Park: the Bullhouse Apartments at 504 E. Pettigrew St., and the Van Alen apartments at 511 S. Mangum St., a Northwood Ravin project that will add around 400 apartment units.
Jeff Harris, divisional president for the Carolinas at LMC, said he expects to have the site plans approved sometime in the spring with construction starting soon after. He added that the company’s investment in the project will be significantly more than $100 million.
“It is a big investment,” he said.
Originally, after buying the downtown property for $13.5 million in 2017, LMC wanted to include an office tower along with the apartments on the project. But talks with a potential office developer fell apart last year, Harris said.
“We had extensive conversations with an office developer and then they bought the Venable Center,” Harris said. “When that fell through, we went back to the original plan (of only apartments).”
In July, a group of developers made up of Wheelock Street Capital, SLI Capital and Trinity Capital Advisors, bought the Venable center for $27.3 million, The News & Observer previously reported. That group plans to expand the Venable Center by building more office space on top of one of the center’s surface parking lots.
As a result, Harris said, LMC will add another 100 apartment units on the part of the property that was meant to be an office building. Those apartments will be added during a second phase, Harris said.
In the past two years, the southern section of downtown around the Durham Performing Arts Center, the courthouse and the Bulls stadium, has seen a flurry of investment from apartment builders, bringing with it more than a thousand apartment units. The projects have ranged from luxury high rises to an affordable housing project spearheaded by the city.
Harris said he isn’t worried that developers are adding too many apartments to the downtown core at one time.
“We feel very good about Durham and the broader Triangle,” Harris said. “The job growth in the Triangle is quite robust, and if this office building goes forward on the Venable site and some other things that are programmed, we think downtown Durham is going to be the most exciting place to live in the Triangle.”
With the apartments not likely to hit the market until the end of 2020, it is too early to say how much the units will rent for. But the adjacent Van Alen apartment projects is currently listing units ranging from around $1,300 for a one-bedroom unit to three-bedroom units going for more than $4,000 a month.
The apartment project will represent LMC’s first foray into the Triangle market. The national apartment builder’s other work in the state has focused on Charlotte.
But that isn’t for a lack of trying. Harris said the company has put out two other bids on properties — one in southern Durham and the other in Raleigh — but lost out because of heavy competition for the land.
“There are a number of new participants looking to put a flag in the Triangle,” he said. “The Triangle has been discovered and there is more competition.”