ARA Newmark Closes Sale of Texas Portfolio

The four-community portfolio presents significant value-add opportunities for the new owner.

Houston—ARA Newmark announced one of its largest Texas deals in 2016, a 1,516-unit portfolio in Houston. The transaction caps 2016 for the Houston office with 188 multi-housing investment sales, capital markets and land transactions valued at more than $3.3 billion. The seller, CBRE Global Investors, was represented by ARA Vice Chairman Matthew Rotan, together with David Oelfke, David Wylie, David Mitchell and Thomas Alleman. The buyer was Highland Capital Management LP and BH Equities, affiliated with the new owner, will manage the properties.

“The portfolio is anchored by Houston’s premier employment centers—Texas Medical Center and the uptown/Galleria district—so the deal presented a rare opportunity to acquire properties that were offered below replacement costs,” Rotan said. “Each asset has unique value-add potential with further upside.” The portfolio consists of Connection at Buffalo Pointe (352 units), The Meritage (240 units), Old Farm Apartment Homes (734 units) and Stone Creek at Old Farm (190 units).

Connection at Buffalo Pointe was built in 2012 and features a fitness center, full indoor basketball court and resort-style pool with grilling stations. According to Yardi Matrix data, the most recent sale was subjected to a $34.5 million loan held by KeyBank.

The Meritage is situated along Houston’s inner loop 610, with convenient access to major business and shopping districts, including the Texas Medical Center, Galleria/uptown district, Greenway Plaza and downtown. Amenities include a resort-style pool area with outdoor kitchen and lounge area, 24-hour fitness center with instructor, 2.5-mile hike/bike trail and social hub equipped with iMacs and a Starbucks touchscreen coffee bar. This deal was subject to a $24.5 million loan also held by KeyBank, according to the same report.

Old Farm Apartment Homes and Stone Creek at Old Farm were both built by Trammell Crow Residential in the late 1990s and most of their units were recently renovated. The two communities feature attached garages, resort-style pools, 24-hour fitness centers, outdoor grilling stations and full-size washer and dryers. According to Yardi Matrix data, the communities are part of a line of credit in the maximum amount of $300 million held by Freddie Mac.

Images courtesy of Yardi Matrix