Investcorp Pays $370M for 5-State Portfolio

Madison Lake Ned. Image courtesy of Equus Capital Partners

Bahrain’s Investcorp has purchased an 11-property, 2,615-unit multifamily portfolio in the U.S. from Equus Capital Partners for about $370 million. The deal for the properties, which are spread across major metro areas in Florida, North Carolina, Georgia, Pennsylvania and Missouri, marks the global alternative investment firm’s largest purchase of a U.S. real estate portfolio in the past decade.

Equus sold the assets on behalf of a private equity fund it manages, BPG Investment Partnership IX LP, which has invested in multifamily, office and industrial properties across the country since 2013. Out of 30 total investments by the fund, 26 have now been sold with only 4 office properties remaining.

The apartment portfolio acquired by Investcorp was 95 percent leased at the time of sale. The properties have an average unit size of 1,020 square feet and an average age of 25 years. Equus assembled the portfolio between 2013 and 2015 and spent more than $20 million on renovations and upgrades. Equus affiliate Madison Apartment Group oversaw the capital improvements program and will continue to provide on-site property management.

HFF’s Michael Joseph, Matthew Lawton, and Stella Pappas represented Equus in the deal, while HFF’s debt team, consisting of Mike Tepedino, Mike Gigliotti and Mona Carlton, secured financing for the buyer.

Buying into key metro areas

The assets are located in six population-dense or high-growth metro areas and offer opportunities for value-add renovations, according to a statement by Investcorp. The portfolio includes properties in Raleigh, N.C.:

• Madison Hunters Glen Apartments (180 units) at 100 Hunt Club Lane
• Madison Laurel Oaks Apartments (164 units) at 3111 Long Meadow Court
• Madison Laurel Springs Apartments (122 units) at 500 Bridleridge Drive

In the Orlando, Fla., area:

• Madison Clermont (250 units) at 600 River Birch Court, Clermont, Fla.
• Madison Riverwalk (280 units) at 990 English Town Lane, Winter Springs, Fla.

In the Tampa, Fla., area:

• Madison Park Road (248 units) at 2120 Village Park Road, Plant City, Fla.
• Madison Lake Ned (212 units) at 4025 Lake Ned Circle, Winter Haven, Fla.

In the St. Louis area:

• Madison Rockwood (251 units) at 170 Steamboat Lane, Ballwin, Mo.
• Madison Prairie Point (376 units) at 1 Prairie Point Drive, O’Fallon, Mo.

In addition to that, the portfolio includes one property in Atlanta (Madison Brookhaven with 288 units at 3078 Clairmont Road N.E.) and another one in the Philadelphia area (Madison Glen Mills with 244 units at 512 Coventry Lane, Glen Mills, Pa.).

Investcorp had $22.5 billion in total assets under management at year-end 2019. According to Real Capital Analytics data cited by the firm, Investcorp has been a top 10 buyer of U.S. multifamily assets over the past 12 months, adding roughly 7,700 units to its portfolio.

The company’s real estate investment team purchased a six-property multifamily portfolio across Tampa, Houston and Salt Lake City for $311 million last November.