BRATTLEBORO — New York-based real estate firm Time Equities Inc. (TEI) in April purchased the two buildings that house Sam's Outdoor Outfitters, Sam's Too, and 48 apartments.
Brad Borofsky said his family's business, Sam's, will remain open and operating. The business has signed a long-term lease with TEI, he said.
“We have no plans of leaving any time soon,” Borofsky said in the midst of writing inventory orders for next spring and summer.
“We'll be here longer if the sales environment can stay healthy enough to sustain us,” he added.
The Barber Building - 62-74 Main Street - and 9 Flat Street mark TEI's first acquisition in Vermont.
According to the real estate firm's news release, the majority of the company's holdings are in the Northeast. The company has properties in 27 states, five Canadian provinces, Germany, the Netherlands, and Anguilla, in the British Virgin Islands.
Selling the two buildings provided a good business opportunity, Borofsky said. Borofsky's grandfather Sam started the business in 1932.
“We didn't have to sell the building,” Borofsky said.
According to Borofsky, Sam's three stores - in Brattleboro, Keene, New Hampshire, and Hadley, Massachusetts - are strong and healthy.
He added, however, that now is a good time to sell. He said Brattleboro “looks good” between the Brattleboro Food Co-op's new building, wonderful restaurants, the renovated Brooks House, and post-Tropical Storm Irene repairs.
“I'm not getting any younger,” Borofsky add. Selling now allowed Sam's to “pick our landlord” and “get a lease that is okay with us.”
A downtown in transition
Borofsky highlighted the changes he has witnessed in Brattleboro during his family's tenure at the corner of Main and Flat streets.
He listed a host of stores that used to call Brattleboro home, such as Mann's, Woolworth's, and King's.
There was a time when Keene residents shopped in Brattleboro, he said.
Most outdoor-focused bricks-and-mortar stores are struggling as more people shop on the internet, he said. For Brattleboro, one of the biggest competitors is Keene, NH.
In Borofsky's view, Keene is the region's hub town. It has a variety of stores and amenities and no sales tax, he said. Vermont doesn't charge sales tax on clothing and footwear, but most people don't know that, he added.
Borofsky thanked the local residents who shopped at Sam's. The store also has a steady tourist base - although Mother Nature dictates those tourist sales quite a bit, he said.
According to public documents, after approximately one year on the market, the two buildings were purchased by TEI for $2.4 million. Ranger Curran of RE/MAX Town & Country brokered the deal on behalf of Borofsky.
Borofsky said most of the sale price will go toward paying off debt and toward capital gains taxes.
Together, the two buildings total approximately 64,617 square feet.
TEI wrote in a news release, “The announcement comes in tandem with the full-service firm's 50th anniversary, as it celebrates a milestone of notable international investments and acquisitions across a variety of asset classes.”
According to the news release, the company owns and maintains approximately 22.61 million square feet of residential, industrial, office and retail property. This portfolio includes more than 3,078 multi-family apartment units.
The company has an additional approximately 1.62 million square feet of properties in various stages of development.
Max Pastor, Associate Director of Acquisitions at TEI, noted in the news release that the Sam's buildings offer an opportunity to “become more active in the state of Vermont and surrounding areas.” The buildings also provide “a strong cash flow” and other opportunities.
“Boasting a diverse population, independent stores and restaurants, educational and healthcare services, cultural institutions and an ideal location near the Connecticut River, we are optimistic about the investment potential of Brattleboro and look forward to evaluating future transactions in Vermont,” Pastor said.
In an email, Pastor said the company has searched for properties in Vermont for some time.
TEI is evaluating improvements to the building. When asked what plans TEI has for the existing apartments, Pastor responded, “We plan to implement a medium-term upgrade plan to the residences to enhance and improve units, common areas, and the overall residential experience for current and future residents.”
Changing rental market?
While the buildings' sale marks a transition of the Borofsky family, it also could mark a change for the rental market.
The Barber Building on Main Street houses 48 apartment units, which range from efficiencies (one room) to four-room apartments.
According to the Barber Realty website, which lists apartments' details, rents range from $650 for a one-room apartment to $950 for a four-room apartment. Rents include utilities. All are within walking distance to most services.
A spin through websites that list rentals like craigslist.com or apartments.com turned up a range of rents. Only a handful of the offerings included all utilities.
Rents on efficiencies ranged from $595 to $850. Rents on one-bedroom apartments ranged from $650 to $1,000, with the majority of the rents in the $700 range. Two-bedroom apartments were listed at $775 to $1,800, with most in the $1,000 range. Finally, the few three-bedrooms ranged from $980 to $1,495.
Meanwhile, the U.S. Department of Housing and Urban Development lists the fair market rent for Windham County as $750, including utilities, for a one-bedroom apartment.
Christine Hart, executive director of the Brattleboro Housing Partnerships, said people with Section 8 vouchers are looking in the $750 price range. And that rate is low for the Brattleboro market, she added.
She has noticed that people searching for apartments through the Partnership's voucher programs are taking longer to find them, generally between 30 and 90 days. Hart said she receives lists of where apartment hunters have contacted and that, at least judging by the length of the lists, people are really looking.
“Apartments are tight at that market level,” she said.
When asked if the potential loss of 48 apartments in the $650 to $950 range would affect Brattleboro's rental market, Hart reiterated, “So, the market is tight.”