Tampa‑Franklin Street Real Estate Services has arranged the sale of distressed notes on a four-property multifamily portfolio formerly subject to Section 8 contracts.
The communities are located in North/Central Florida. The note had an original face value of $9,165,000, originated in December of 2004. The properties were in Gainesville, Ocala, Havana and Starke, Fla., and comprised a total of 356 units.
The portfolio was in distress, with one property being vacant at the time of the note purchase and two others being vacated. The properties were previously under a Project Based Section 8 Contract, but these contracts have been removed due to non-compliance reasons with the Department of Housing and Urban Development (HUD) on three of the four properties, according to Franklin Street.
Franklin Street Partners Darron Kattan, Bob Goldfinger and Kevin Kelleher represented the existing owner and, together with Alfredo Guardado of Assistance Realty International, assisted all parties in the sale. The buyer was a private partnership. Franklin Street also negotiated on behalf of the owner to effectuate a transfer of title to the new note holder.
“This was a clear case of the lender not wanting to step into the chain of title and willing to discount the sale of the note significantly to make a deal happen,” said Kattan. “The properties had a variety of challenges, physically and operationally, and significant work and time will be required before the true value of the properties is realized.”