KREST Acquires Brooklyn and Philadelphia Communities
The firm secured two properties in Philadelphia and downtown Brooklyn, totaling 1,380 units.
3900 City Ave. Image courtesy of JLL
KKR Real Estate Select Trust Inc. has made one of the largest acquisitions in Philadelphia with its latest multifamily acquisitions. The firm acquired two communities, one in downtown Brooklyn, N.Y., and one in Philadelphia, from two different sellers in separate transactions.
KREST acquired Presidential City, a community in Philadelphia, for $357 million, and a downtown Brooklyn property for $190 million in July. Billy Butcher, CEO of KREST and COO of KKR’s global real estate business, said in prepared remarks that KREST acquired both properties using irreplaceable long-duration fixed-rate financing.
KREST’s two latest acquisitions total a combined 1,380 units. Built in 2011, the Brooklyn community totals 365 units and is LEED Silver certified. Amenities include an outdoor terrace, fitness center, 24-hour concierge and children’s playroom. The community is within walking distance to several MTA subway stations, giving residents a short commute into Manhattan.
For Presidential City, KREST acquired the 1,015-unit complex along with Mack Real Estate Group. The units are split between five buildings located in Philadelphia’s Lower Merion Township. Presidential City was gut-renovated in 2015 and its amenities now include a pool club, lounge, fitness center and dog park. Mack Real Estate Group’s subsidiary, Mack Property Management L.P., was tasked with handling the property’s operations.
Three-pronged investment strategy
The acquisition of Presidential City marks the second time that KREST is working with Mack Real Estate Group on a multifamily acquisition in Philadelphia. As part of its strategy, the firm seeks long-term ownership of stabilized, high-quality assets in high-growth markets.
Beyond looking for stabilized assets in multifamily or industrial, KREST’s other strategic pillars include prime single tenant assets and private real estate debt. KKR, KREST’s parent company, has also started investing in self storage facilities. The company entered the self storage market with the acquisition of three properties in Austin, Texas and Nashville, Tenn., in July 2021. Several months later, KKR expanded its self storage footprint with three facilities in Denver and Nashville.
