A Bradenton multifamily real estate firm is expanding into the tight-knit — and lucrative — St. Petersburg multifamily market with 220 units it plans to build on two properties.
The plan is for both to share a name, a design style and amenities packages while being split across two locations about a mile apart from one another. One is near downtown and the other is in the city’s Edge District.
“I thought about doing two separate projects, but we're going to manage them as one,” says Robert Ritzenthaler, founder and managing partner of the firm, Nokomis-based REM Capital. “We're going to own them — we're not selling them, we're a long-term owner in St. Pete — so we just figured you get the same concept, the same vibe.”
The communities are going to come under the name Ellington Place, with 146 units at 770 4th Ave. N. and 74 at 200 17th St. N.
The city is undergoing a major construction blitz, but the reality is much of the new inventory is in the high dollar luxury market — a trend already pricing longtime residents out of downtown neighborhoods.
Because of that, REM decided the complex would be made up of one-bedroom and studio units averaging about 600 square feet with rents in the $2,000 per month range. The company believes this will offer potential residents, especially younger people, a more affordable alternative as well as an opportunity for people who may otherwise have been priced out of the market.
“That's really one of the driving factors for our project is that we're going to bring something to the market that is significantly less expensive than most of our competitors,” he says. “And I think they're going to do fine because there are lots of people that are willing to pay more money. But I also feel like there's an underserved market for folks that can't afford to pay $3,000, $4,000 or $5,000 a month and would love to be in downtown.”
In marketing material, Ellington Place is said to “offer a timeless and sophisticated living experience for those seeking the perfect blend of luxury and practically.”
The units will have granite countertops and 9-foot ceilings and the amenities will include pools and cabanas, electric vehicle charging stations and bike parking. Ritzenthaler also envisions a place that features the work of local artists and connects with the community.
“I really don't want a building that's just another building,” he says. “I'm not saying that there's anything wrong with that. But my thought was, we're not this big huge monster project. We don't have the $200 million property, but we can do something that's unique.”
The company is close to completing its construction loan and has the demolition permits in hand. The groundbreaking should be in the next 30 to 60 days. The first tenants could start moving in about 18 months after that.
The total cost of the project including the land is $50 million, Ritzenthaler says.
The development of Ellington Place is also the beginning of a new phase for REM, founded in 2018.
Ritzenthaler says he never imagined having a project in downtown St. Petersburg because it was the preserve of “the big dogs.”
“But I got a little bit lucky,” he says.
What happened is someone he knew owned the property and had secured the entitlements. But that person wasn’t able to follow the project through to the end. “And so, we got to pick the project up. And, yeah, it's fun. I'm excited. I'm really excited.”
For Ritzenthaler, who grew up in the construction industry sweeping floors for his father’s Dallas custom home business, Ellington Place is also an opportunity to return to his roots while expanding into the development side of the multifamily business.
For the first five years of the company’s existence, he had been focused on building the business by concentrating on workforce housing, buying properties in several cities across the U.S. According to REM’s website, the company owns 3,401 units in 22 properties in eight states. It has about 140 employees.
Buying the existing properties helped create a steady cash flow in the early years, but the plan all along was to get into the development side. In addition to the St. Pete project, REM has two development projects in San Antonio, Texas.
“Part of the reason I wanted to wait to do the development side," Ritzenthaler says. "is because I wanted to have enough infrastructure to really be able to handle the lease up and the marketing and construction."
Correction: This story has been updated to correct where REM Capital is based.
Louis Llovio is the commercial real estate editor at the Business Observer. Before going to work at the Observer, the longtime business writer worked at the Richmond Times-Dispatch, Maryland Daily Record and for the Baltimore Sun Media Group. He lives in Tampa.