Castle Lanterra has sold a pair of apartment communities totaling 570 units in Corpus Christi, Texas. According to Castle Lanterra, the firm sold Azure, a 220-unit community, to Sundance Bay and Baypoint Apartments, a 350-unit community, to Pegasus Real Estate, for undisclosed prices.
The firm acquired Azure in July 2016, but invested more than $700,000 during its ownership and implemented a value-add program on approximately 45 percent of the units. The community, which was originally built in 1997, has its one-, two- and three-bedroom units spread across 10 three-story residential buildings. Azure’s common amenities include a resident lounge, coffee bar, business center, fitness center, swimming pool, volleyball court, dog park and picnic areas. The community is 95 percent occupied, according to Yardi Matrix data.
Castle Lanterra invested a much larger sum into Baypoint Apartments, which was built in 1998. After its acquisition of the community in May 2018, the firm conducted capital improvement projects that totaled nearly $6 million. The renovations included redesigning the clubhouse, dog park and playground, while also creating a pet spa and enhancing approximately 50 percent of the units. Baypoint Apartments’ amenities also include a fitness center, climate-controlled storage, boat parking, and sports courts. The community is now 93.1 percent occupied, according to Yardi Matrix data.
HIGH RATE OF RETURN
Elie Rieder, founder & CEO of Castle Lanterra, said in prepared remarks that it was the ideal time to sell the two communities after the firm invested significant capital improvements over its years of ownership. According to Castle Lanterra, Azure achieved an internal rate of return of 17.2 percent, while Baypoint posted a 19.1 percent return.
Last year, the firm sold a 608-unit waterfront community in Annapolis, Md., for $154 million.