Duo Acquires South Carolina Portfolio for $70M

New York-based companies Machine Investment Group and Prospect Lane have secured $53.4 million in bridge financing for the $70.1 million acquisition of a portfolio in South Carolina.

Syndicator GVA Real Estate Group previously owned the seven assets, which are located in Spartanburg and Mauldin, S.C. The properties were built between 1971 and 1986 and total 877 units.

The portfolio comprises Southern Pines, a 352-unit apartment complex located at 350 Bryant Road in Spartanburg; Pine Lake Village a 100-unit apartment complex located at 180 South Pine Lake Drive in Spartanburg; Willow Lakes, a 95-unit apartment complex located at 2900 Reidville Road in Spartanburg; Quail Pointe, a 100-unit apartment complex located at 460 East Blackstock Road in Spartanburg; Hidden Park, a 100-unit apartment complex located at 320 Spruce Street in Spartanburg; Mauldin Heights, a 80-unit apartment complex located at 901 North Main Street in Mauldin; and Parkview, a 50-unit apartment complex located at 10 Moore Street in Mauldin.

Machine Investment Group is a real estate investment platform focused on opportunistic, distressed and special situations in the United States. Prospect Lane is a national real estate investment and development firm focused on multifamily value-add opportunities.

JLL Capital Markets arranged the acquisition financing, a three-year, floating rate loan. The JLL Capital Markets Debt Advisory team was led by Senior Managing Director Jamie Leachman and Directors Jonah Aelyon and Carter Wroblewski. Further details about the loan were not disclosed.

Portfolio highlights

The portfolio is comprised of five properties in Spartanburg and two in Mauldin. The properties are about 70 percent occupied. The portfolio has 139 newly renovated units and the new owners plan to remodel 300 additional apartments. Unit restorations will include adding new cabinet faces, stainless steel appliances, quartz countertops, light fixtures and non-carpet flooring.

Exterior renovations will include adding new roofs and upgrading parking lots, sidewalks, exterior painting, HVAC systems and installing security cameras.

The properties are all located within South Carolina’s Upstate region, which has seen population growth of more than 500,000 in the past decade. The region has seen net migration of more than 94,000 residents in 2022 alone. Economic growth within the Greenville, S.C., MSA has been driven by factors including BMW’s Plant Spartanburg, Michelin’s North American Headquarters and the Inland Port Greer. Spartanburg County’s inland port reached an all-time record in July, moving 17,332 containers on and off trains, a 17 percent increase over the previous year, according to port officials. The inland port, located near Greenville-Spartanburg International Airport, is undergoing a five-year, $50 million expansion that will more than double its capacity.

In September 2022, Machine Investment Group and HPP Real Estate, a division of Hill Property Partners, recapitalized North Hill Apartments, a 148-unit community in the Hilltop submarket of Virginia Beach, Va. HPP had acquired the asset in 2021 for $28.2 million. The recapitalization marked the first transaction for the joint venture, which planned to focus on acquiring value-add properties. At that time, Machine Investment Group had also announced the closing of Machine Real Estate Fund I with approximately $350 million in primary and co-investment capital.