BMR Sells Norfolk Apartments, Closes on Lending
The buyer also got funding for capital improvement projects.
BMR Investments has sold Sherwood Forest, a 173-unit two-story apartment community located in Norfolk, Va. Greysteel brokered the sale, and arranged a $16 million conventional loan as part of the transaction.
The sale attained a 5.25 percent Year 1 NOI sale cap rate, reflecting robust demand for multifamily properties in the Norfolk market. The fixed-interest rate loan was provided by a credit union, and closed at a 80 percent loan-to-cost ratio, with two years of interest and no prepayment penalty. The financing also earmarked funds for capital improvements.
First, however, the brokers needed to clear some hurdles. “The financing had some hurdles we had to work through while getting to a close,” Jack Whitman, senior associate of capital markets at Greysteel, told Multi-Housing News. “The deal required a strategic pivot mid-process. The original plan was to acquire the property and renovate some units out of cash flow via an agency loan. However, due diligence and market shifts revealed the need for a bridge loan to fund future capex while meeting the borrower’s requirements for a fixed rate and flexible prepay.”
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Built in 1965 at 2803 Early St., Sherwood Forest is sectioned into one- to three-bedroom apartments. Features and finishes include vinyl flooring, window coverings, ceiling fans, breakfast nooks and walk-in closets. The community offers access to public transit, along with an array of dining and entertainment options in Norfolf. The community is also proximate to a variety of recreational and park amenities that include the Virginia Zoo, Norfolk Botanical Garden and Fred Heutte Center, all within 9-minute drive.
Activity in Old Dominion
Just last week, a joint venture between RPC Capital and Kalyan Hospitality landed a $68 million construction loan for Altitude on Main, a 302-unit office-to-residential conversion project in downtown Richmond.
A month ago, Greystar commenced construction on Old Ivy Residences, a 189-unit community in Albemarle County, Va. It includes both traditional apartments and build-to-rent homes.
