Kushner Buys Stake in Baltimore/DC Apartment Portfolio

By Dees Stribling, Contributing Editor

New York—Kushner Cos. has acquired roughly a 25 percent ownership stake in 10 multifamily assets totaling 5,517 units in Baltimore County and Prince George’s County, Md. The properties consist of two- to four-story garden-style and townhome apartments mostly in the Baltimore MSA, with one located in greater Washington D.C.

The acquisition represents a recapitalization of the portfolio, with a Rockpoint Group partnership retaining the remaining three-quarters interest in the properties. The new financing will be used to pay off the remaining existing debt and preferred equity, and other purposes.

Beech Street Capital arranged $371 million in Freddie Mac Capital Markets Execution loans for the deal. The loans were originated by Meridian Capital Group LLC, which has a correspondent relationship with Beech Street. The loans are for 10-year terms, with an LTV of about 74 percent. The property will be managed by Westminster Management, an affiliate of the Kushner Cos.

“There’s ample liquidity for multifamily debt,” Grace Huebscher, president and CEO of Beech Street, tells MHN. “The agencies who are major players in this market continue to be appropriate in the way they underwrite and manage credit.”

Kushner Cos. has owned about 30,000 apartment units during its three decades in business. In 2007, however, it sold a large multifamily portfolio to focus on other kinds of commercial property. But during the last 12 months or so, the company has come back to the multifamily space with gusto, acquiring interests in about 11,000 units.