North Carolina Community Sells for $57M
CBRE represented RK Properties, which sold the Raleigh property five years after acquiring it.
Raleigh, N.C., skyline. Image by Higgins Spooner via unsplash.com
RK Properties, a Long Beach, Calif.-based multifamily property investment firm, has sold Edwards Mill Townhomes and Apartments, a 220-unit multifamily community in northwest Raleigh, N.C., for $56.5 million, more than five years after making its initial investment in the Triangle for $34.5 million.
Covenant Capital Group, a Nashville, Tenn.-based real estate investment manager, acquired the property at 4428 Mill Village Road, according to the Triangle Business Journal. The business journal also reported RK Properties bought the multifamily asset from Starwood Capital Group in 2017.
That transaction occurred in August 2017 and was RK Properties’ first Delaware Statutory Trust, or 1031 exchange, structure, the firm announced at the time. It was the firm’s third and final property made through the RK Opportunity Fund IV, according to a prepared statement. RK Properties stated it planned to make interior unit upgrades as well as exterior building enhancements.
Built in 1984, the Class A community is situated on 36.5 acres with one-, two- and three-bedroom townhome-style and garden-style apartment homes. The units include central HVAC, standard-size washer/dryers and large closets. Community amenities feature a three-tier sundeck, resort-style swimming pool, clubroom, basketball and tennis courts, 5,000-square-foot fenced dog park and a 20-mile fitness trail. The property is adjacent to the 15.9-mile Crabtree Creek trail and a half-mile from the 1.4-million-square-foot Crabtree Valley Mall. Residents are about 10 minutes to downtown Raleigh and have easy access to nearby interstates 440 and 70.
Investor Interest
CBRE arranged the sale of the property. Howard Jenkins, Kevin Kempf, William Yowell and Drew Harney with CBRE’s Multifamily Investment Sales team represented RK Properties. K.O. Kennedy and Scott Brady of CBRE Debt & Structured Finance secured the debt for the buyer.
Jenkins, an executive vice president with CBRE|Raleigh, said in a prepared statement the team was able to secure strong investor and lender interest despite capital markets’ volatility. He said the community’s solid fundamentals and desirable locations attracted interest to the asset. Jenkins cited Raleigh’s growing knowledge-based economy and recession-resistant demand drivers among the factors. He also noted Raleigh’s accelerating in-migration and comparatively high rent multiplier compared to other Sun Belt metros that continue to attract multifamily investors from across the United States.
RK Properties is a national company focused exclusively on multifamily property investments since 1977. The firm has purchased more than 158 properties that at today’s value would be more than $3 billion. More than 143 of the acquisitions have gone full cycle. RK Properties currently has a portfolio valued at more than $1 billion located in California, Nevada, Louisiana, Georgia, Florida, South Carolina and North Carolina.
