Stillwater Capital

Stillwater Capital pic copyStillwater Capital is highly engaged in the acquisition and construction of its residential properties to ensure high-end results.

By Janice Hoppe-Spiers

Stillwater Capital began a decade ago specializing in acquiring and managing a spectrum of real estate products. The company has a range of experience in managing unique properties, such as infill multifamily communities, mixed-use properties, build-to-suit properties and high-end single-family homes.

The Dallas-based company decided a few years ago to bring the construction of its residential projects in-house to ensure greater quality. “We started Stillwater Construction because we felt we could better control the process, quality and schedule by bringing it in-house,” Principal Aaron Sherman adds. “We are hiring the project managers and superintendents directly, which makes the process much more efficient and better overall in terms of production.”

Stillwater Capital prides itself on a diverse portfolio that ranges from student housing and Class A multifamily buildings to multimillion-dollar custom homes. The company maintains high-end quality and says it takes its design detail to the next level throughout its properties.

“We take a $2 million custom home and take those design qualities and the way we construct it, and bring that into the multifamily space,” Sherman says. “Our opinion is really that thoughtful design doesn’t take a lot of extra money. It takes extra thought and shows up in some of our multifamily products. We bring a higher level of quality and design that we use and cross over our verticals.”

The Hudson

The Hudson is an eight-story student housing project near the Texas A&M campus in College Station, Texas, that is leasing for the fall 2018 semester. Stillwater Construction began construction on The Hudson in January 2017 and is expected to be completed in August 2018.

“In the current construction environment you still have labor shortages that affect your overall schedule,” Sherman notes. “In the student housing space that’s our biggest challenge because you can’t delay the schedule and that requires coordination of our subcontractors, long hours and multiple shifts to complete the project.”

The Hudson features five floors of living space above three levels of parking. Amenities include a tech café, fourth-floor deck pool with grilling stations, courtyards with putting green and outdoor seating, game room, fitness center, eighth-floor sky lounge with fireplace, multiple study rooms and resident events. The Hudson boasts professional on-site management. Stillwater Capital box

“In the amenity space, it’s evolving and what a student wants now and expects is different than it was 10 years ago,” Sherman says. “We have spent a lot of time, money and effort to develop best-in-class connectivity in our student housing. The student housing space leads the market and those trends trickle into the multifamily space.”

Stillwater used prefabrication for the first time on The Hudson. The eight-foot exterior wall panels were digitally cut and built in a Denver-based production shop and erected on-site. “It saves a great amount of time in construction and with student housing you can’t be late,” Sherman says. “It allows us to build higher, denser products because wood framing has its limits in terms of height from a structural standpoint and building code. Steel allows you to go higher and it’s not as expensive as concrete.”

Stillwater expects to continue using prefabrication on its multifamily projects moving forward. “Land prices are going up so you have to build denser and more units on that piece of land to justify the land price,” Sherman explains. “Prefabrication is the way to do it without the cost going up with a concrete structure.”

The Atwood

Stillwater’s The Atwood consists of 318 townhomes and flats with one-, two- and three-bedroom floor plans on seven acres of land in Dallas. The company began developing The Atwood in summer 2015 and completed the first units in February 2017.

“We are 90 percent leased at this point,” Sherman notes. “One of the unique things about The Atwood is the townhouse layout. The single-family market continues to be difficult for the first-time homebuyer because financing is still really tough. We think home purchases have been pushed off, but as the demographic gets older they don’t want a dense apartment complex with loud parties or the frat house lifestyle.”

To address those pain points for the late 20- to early 30-year-old renter, Stillwater developed The Atwood. “There is a real demand for more single-family living in a rental market and the townhouse concept creates that,” Sherman adds. “They have direct access to their garage, private front yards, street-level entry, and it’s a much larger unit than what you typically see in urban multifamily buildings.”

The Atwood has a modern, craftsman-style feel and is accentuated with a clubhouse, pool, fitness center, yoga and spin studio, green spaces for pets and a rooftop deck for outdoor grilling or entertaining. The flats are located above the townhomes, which Sherman says is unique to The Atwood.

“It’s a way to have fairly dense amount of rentable square feet when zoning limits you to three stories,” he adds. “By burying the garage it keeps the cost down and we get more rental square feet in this zoning area.”

Moving forward, Stillwater plans to continue to adapt and respond to market demands. “When you start the development of a project you are making a bet on demand two to three years out, so you have to be aware of the macroeconomics and trends happening now,” Sherman says. “Our strategy is to focus in Texas and continue to build a really good team internally and maintain long-term relationships with our subcontractors who are an important part of our continued success.”

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