Associated Estates Purchases Apt. Portfolio from Northwood Ravin for $329.9M
In a $323.9 million portfolio deal, Charlotte-based developer Northwood Ravin has agreed to sell seven apartment communities totaling 1,606 units to Ohio real estate investment trust Associated Estates Realty Corp.
Two of the properties are located in the Triangle (in Raleigh and in Cary); three are in Charlotte; one in Atlanta; and one in Tampa.
According to the NewsObserver, Associated Estates paid $27.325 million or nearly $204,000 per unit for St. Mary’s Square, a 134-unit multi-family property in downtown Raleigh. The community opened just a few months ago and is already 90 percent leased.
The acquisition price sets a new Triangle record, previously attained in the spring of 2012, when Dallas-based Crow Holdings Capital Partners purchased the 409-unit residential component of the Park & Market Apartments at North Hills East in Raleigh. Kane Realty Corp. sold the property for $82 million or $200,489 per unit.
In Cary, Northwood Ravin has acquired the 215-unit Lofts at Weston for $38.3 million, or $178,000 per unit. The property, a joint venture between Northwood Ravin and Highwoods Properties, opened on Weston Parkway in March and is 80 percent occupied.
Four of the remaining five properties included in the transaction are currently under construction and should open in the next few months.
The sale represents a shift in strategy for Northwood Ravin, which usually develops communities with the intent of operating them on the long haul.
“You can’t always stay with one strategy because the marketplace is always changing, and multifamily in particular has been changing rapidly,” the company’s president and CEO, David Ravin, told the newspaper. “We saw an opportunity to recycle some capital, to return investments to our investors at a good rate and thought it was an opportune time to reposition ourselves.”
Ravin also said he expected the pace of apartment sales to slow in the near-term, as investors observe the way the new inventory performs.
The Triangle Business Journal reports that, according to the semi-annual Triangle Apartment Market Report by the Karnes research firm and Triangle Apartment Association, 15 new apartment communities totaling 2,899 units have opened in the region in recent months. Another 9,336 units currently under construction in the Triangle are scheduled to open by early 2015.
Northwood Ravin has three other properties in the Triangle, including The Bradford in Cary, The Apartments at Palladian Place in Durham and The Edge in Chapel Hill.
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