314 apartment units to be built in Laurel

November 22, 1994|By Kevin L. McQuaid | Kevin L. McQuaid,Sun Staff Writer

Summit Properties Inc. will begin construction early next month of a $22.1 million apartment complex in Laurel, one of the first new multi-family projects in the Baltimore metropolitan area this decade.

The Charlotte-based real estate investment trust announced yesterday that it had finalized the land purchase for the 314-unit complex with the master developers of Russett Center, a 900-acre planned community in Anne Arundel County, late last week.

Summit's decision to develop the nine-building, 278,000-square-foot apartment project comes at a time when a bevy of REITs -- including United Dominion Realty Trust and Town & Country Trust -- have scoured the Baltimore-Washington corridor for new acquisitions of existing complexes.

That competition has driven the price of existing properties up, and total returns down, a trend that analysts expect to encourage real estate companies to emphasize new development.

"There are higher returns for us right now to develop new projects, based on where we are in the development cycle and when factoring in potential risks and rewards," said David F. Tufaro, a Summit executive vice president and chief operating officer.

"And Russett specifically has an excellent location, access to both Baltimore and Washington, and proximity to Fort Meade and other large employment centers," said Mr. Tufaro. The Russett Center is located at Route 198 and the Baltimore-Washington Parkway.

The Summit project -- the only rental housing planned for Russett -- also represents one of only two nonsubsidized complexes either slated to begin or under construction in the region. The other is the $20 million Red Run Apartments nearing completion in Owings Mills.

Financing for the Summit complex, including the $3.77 million to purchase the 20 acres, is being provided through a five-year mortgage loan from NationsBank Corp.

Summit intends to charge rents of between $735 and $1,100 a month for one- to three-bedroom units at the complex, slated for completion in spring 1996, Mr. Tufaro said. The first units will be available next summer.

"Not everyone can afford to own a home, or the down payment associated with it," said David Adler, a partner in Coscan/Adler Ltd. Partnership, which together with Lovell Land Corp. is Russett's master developer. "This gives people the ability to become acquainted with Russett, and possibly move up to a condominium or single-family home there."

In addition to its Russett project, Summit has developed five Maryland complexes totaling 1,024 units.

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