JLL Multifamily Capital Markets experts have completed the sale of SkyHouse Uptown in the popular Fourth Ward Uptown enclave of Charlotte, N.C. Developed and sold by Novare Group, SkyHouse Uptown is a landmark high-rise residential community consisting of two 24-story towers built in two phases in 2015 and 2017. Included in the property are 14,000 square feet of retail and an eight-story parking structure.
The property, which is located at 640 N. Church St., was acquired by the CBRE Strategic Partners U.S. Value 8 fund. According to the Charlotte Business Journal, quoting Mecklenburg County real estate records, SkyHouse Uptown was sold for a combined $190 million.
“SkyHouse Uptown was a complex transaction insofar as it represented one of the largest, if not the largest, single-asset multifamily transaction in recent times in the Southeast,” JLL Managing Director David Gutting told MHN. “We knew that without a solid capital strategy in place to limit the impact of “scale”, the buyer pool would be shallower than what we would otherwise see for a smaller-sized transaction. To overcome the scale issue, we crafted a pre-designed capital structure of low leverage permanent debt, coupled with a layer of lower cost preferred equity. That combination expanded our buyer pool significantly and made the process very competitive.”
The brokerage team also explored giving potential buyers the option of acquiring both buildings together or splitting the twin towers and selling them to two separate groups.
“As it turned out, we found most buyers actually wanted to accumulate scale and not compete with another operator next door […]. We largely leveraged our experience selling SkyHouse Raleigh a couple of years ago and felt comfortable we would have a successful transaction here”, added JLL Senior Vice President Andrea Howard.
The JLL team negotiating the sale also included Senior Vice President Jim Sewell and Vice President John Currin.
Largest Single-Asset Deal in the Southeast
Offering 672 apartments ranging from studios to three-bedroom residences, SkyHouse Uptown is the first purpose-built, high-rise apartment in Charlotte.
Topping each tower is a rooftop pool with covered poolside lounges featuring billiards, fire pits, large flat-screen TVs and perspectives on Charlotte’s downtown skyline. A one-acre SkyPark atop the parking structure provides outdoor amenities.
“At 672 units, the total single-asset deal size was one of the largest to ever trade in the Southeast,” concluded Gutting in prepared remarks. “SkyHouse Uptown’s location in the heart of Charlotte’s ongoing development boom made this an investment opportunity that attracted strong investor interest.”
Image courtesy of JLL