Lion Real Estate Acquires Charlotte Portfolio

Lion Real Estate Group has acquired a two-property apartment portfolio in Charlotte out of foreclosure. The acquisition expands the firm’s Charlotte market presence to three communities and was made on behalf of Lion’s Fund III investment vehicle.

The portfolio consists of the 128-unit The Woodlands and the 80-unit Reserve at Campbell’s Creek, which the buyer is collectively rebranding as Creekside Canopy. Both properties were sold to Lion by a debt fund, which had foreclosed the loans associated with the apartment buildings. 

The previous owner had been GVA Real Estate Investments, which defaulted on a string of mortgages in recent years. The lender in the REO sale was represented by John Phoenix and Gavin Conlon at Cushman & Wakefield.

In 2022, Reserve at Campbell’s Creek fetched $11.5 million in a sale to GVA, up from the previous sale price in 2019 of $8.2 million, according to Yardi Matrix data. Also in 2022, The Woodlands sold for $21.4 million as part of a portfolio, an increase from $12.2 million in 2020.

The Reserve at Campbell’s Creek, located at 5616 Farm Pond Lane, was completed in 1984 with an addition in 2019. The property offers studio, one- and two-bedroom units averaging 775 square feet. The property is 91.1 percent occupied, according to Yardi Matrix data.

Unit amenities include washer/dryer hookups in some units, vaulted ceilings, microwaves in all units and high-speed Internet. Common-area amenities include a community room, playground and 160 parking spaces.

The Woodland, situated 6401 Woodbend Dr. and developed in 1983, has a similar range of studio, one- and two-bedroom units averaging 748 square feet. The property is 93.8 percent occupied, according to Yardi Matrix data.

Unit amenities are also similar, though all units have washing/dryer hookups and the top-floor units feature fireplaces. Common-area amenities include a clubhouse and playground, as well as two swimming pools and 228 parking spaces.

Reserve at Campbell’s Creek was previously renovated, while The Woodlands will see a full renovation of its interiors and exteriors, notes Lion Vice President, Acquisitions, Ben Kriegsman. Investments necessary to deal with previous deferred maintenance will also be made at both communities.

Charlotte stays strong

Charlotte multifamily fundamentals were reasonably strong going into the third quarter, with demand trailing new supply, but catching up, Yardi Matrix reports. The metro’s rent movement turned positive in April, after a longer period of contractions, in line with overall U.S. trends. Year-over-year asking rents were still in negative territory, however, down 2.3 percent, and overall occupancy dropped 90 basis points in a year, to 93.5 percent as of May.

There are relatively few apartment-associated REO sales in the current climate, which sees apartments in relatively high demand, coupled with supply that hasn’t kept up. The Mortgage Bankers Association reports that in the third quarter of 2024, only 1.2 percent of multifamily loans were more than 30 days delinquent, up slightly from 1.1 percent during the previous quarter. Even fewer are reaching the point of a REO sale.

It is mostly the office sector with an elevated delinquency: 7.8 percent of office-associated loans were 30 days or more days delinquent in the third quarter, up from 7.1 percent at the end of the previous quarter.