Prime location could bring condo tower to Bayou Park Apartments campus
Nitya Capital has made its most expensive acquisition to date with the purchase of the Bayou Park Apartments and plans to carve out a spot for a high-rise condo tower on a portion of the site in the next few years.
The Houston-based company purchased the 679-unit complex at 4400 Memorial Drive near Shepherd from Alara Ventures Bayou Park. The 1970s-era complex sits on 15 acres across from Buffalo Bayou Park, just northeast of the River Oaks neighborhood.
Putting up a condo tower, which could start as early as fall, would take less than an acre, said Nitya Capital CEO and managing partner Swapnil Agarwal. The company would ideally develop the project in-house with an estimated time frame of two to three years.
“We have started engaging with consultant and developers,” Agarwal said. “The land in that kind of location is very hard to come by.”
Agarwal declined to disclose the purchase price for the property, which is the second-largest in the Nitya portfolio behind the 1,094-unit Village of Piney Point.
A condo would appeal to empty nesters in River Oaks and other homeowners looking for lower-maintenance residences, Agarwal said.
The complex, now managed by Nitya’s Karya Property Management affiliate, fits the formula of investing in complexes in regions with strong job growth that offer a good value compared with newer properties.
“It’s a very affordable rental option in a great, great location,” David Wylie of Newmark Knight Frank said. Wylie brokered the sale.
Rents at Bayou Park average $1,000 a month, or between $1 and $1.05 per square foot, Agarwal said. By comparison, new apartments in the area average about $1,600.
As apartments turn over, Nitya plans to upgrade the units with new floors, granite counters, stainless steel appliances, new lighting and fixtures.
“The tenants will basically get a very comparable product to new apartment complexes at at least $400 to $500 cheaper,” Agarwal said.
Other updates include fresh landscaping, new signs and changes to the leasing center.
Since being founded in 2013, Nitya Capital has acquired nearly 16,000 apartment units in Texas. It has also invested in an office building and next plans to build three-story townhomes in the $600,000 to $650,000 range on Memorial Heights Drive, south of Washington Avenue.
Since venturing into the office sector a year ago, Nitya Capital has drawn new tenants to its 11-story building at 2211 Norfolk and renewed tenants at higher rates.
Interior renovations are underway, and a new Nitya Tower sign is in the works.
“The office market is picking up now,” Agarwal said. “Houston probably will be the No. 1 city in the country for job growth this year.”