OKLAHOMA CITY (April 20, 2022) – Two months after a fire destroyed a 326-unit apartment project at Classen Curve known as The Canton, the development partnership led by Hines and Humphreys Capital continues to work diligently to move forward.
“We have been steadfast in our belief in this project since we began the process in 2019," said Todd Glass, Senior Managing Director of Investments at Humphreys Capital, the lead investor in the project. “Our confidence in the Oklahoma City market and in the amazing quality-of-life Classen Curve has to offer residents has only increased over the years. We were close to completing construction and starting leasing when the fire occurred. Now we must wait for the fire investigations to be completed before we can assess next steps.”
Local real estate expert Travis Mason, a broker at Cushman and Wakefield, suggested demand for new apartments in Oklahoma City will continue to grow, with rising population and soaring housing prices leading to increased demand. Additionally, the supply of new multifamily units within the urban core remains below market needs, partly as a result of the pandemic and increased construction costs.
When the fire occurred, The Canton was just weeks away from receiving a certificate of occupancy, which would have allowed finalization of leases and residents to begin moving in. The project was on track to lease up faster than expected and at rents well above initial projections. According to industry reports, the median monthly rent for a one-bedroom apartment rose 9.1% compared to the same time last year.
While the partnership behind the development hopes to proceed soon, many factors are outside of their control. The Feb. 8 five-alarm fire catalyzed a series of legal, insurance and other evaluations and determinations that must be resolved before any definitive decisions are made. The completion of third-party assessments is also delaying the final site clean-up.
Benny Fulkerson, Battalion Chief of the Oklahoma City Fire Department confirmed the investigation is ongoing. OCFD investigators are coordinating with multiple insurance companies and other interested parties, including the general contractor and local utility providers.
“Our development team continues to work through the process,” said Hines Senior Managing Director David McGinnis. “While the fire shocked and saddened us, we remain incredibly grateful that no one was hurt. Buildings can be rebuilt, and when this process is complete we hope we have the opportunity to work with our partners at Humphreys Capital on another first-class development in Oklahoma City.”
Project representatives cannot speculate on the specific cause of the fire until the investigation is complete. However, they refuted multiple conspiracy theories. They noted the building featured standard building components and features for a project of this nature and the project was on track to outperform financial projections.
Blair Humphreys, CEO of Humphreys Capital added the following perspective:
“Our company has managed real estate investments for more than 50 years across three generations, but this is our first time to encounter a disaster of this magnitude. It is certainly a humbling experience and has made us especially thankful to be working with a world-class partner like Hines. We are following their lead and are optimistic we will figure out a way to move forward together.”
ABOUT HUMPHREYS CAPITAL
Humphreys Capital is an Oklahoma City-based real estate investment company that acquires and develops income-producing properties. The firm focuses on dynamic high-growth cities across the United States, where it specializes in privately negotiated off-market, mid-size deals of institutional quality. The multigenerational team provides expertise and exposure to diversified commercial real estate for accredited and institutional investors. Since inception, the Humphreys Real Estate Income Fund has provided investors with an average annual return of 13.76%.
Hines is a privately owned global real estate investment firm founded in 1957 with a presence in 285 cities in 28 countries. Hines oversees investment assets under management valued at approximately $90.3 billion¹. In addition, Hines provides third-party property-level services to 373 properties totaling 114.2 million square feet. Historically, Hines has developed, redeveloped or acquired approximately 1,530 properties, totaling over 511 million square feet. The firm currently has more than 198 developments underway around the world. With extensive experience in investments across the risk spectrum and all property types, and a foundational commitment to ESG, Hines is one of the largest and most-respected real estate organizations in the world.
“The median monthly rent for a one-bedroom apartment was $840, up 9.1% compared with this time last year; and the median for a two-bedroom unit was $980, up 8.9% year over year, Zumper reported.”
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