Banking on Interior Renovations
- Mar 06, 2015
Baltimore—A joint venture acquisition between Tryko Partners LLC and Investcorp of Fairways at Towson Apartments, an 828-unit apartment community in Baltimore, has been announced. The new ownership will immediately kick-off a multi-million-dollar capital improvement program at Fairways.
The property, located at 6906 Donachie Road, includes studio and one- to three- bedroom apartments in one high-rise and 35 garden-style buildings, along with shared resident amenities.
“We recognized an outstanding, value-add opportunity in Fairways,” noted Tryko Partners’ Uri Kahanow, director of acquisitions. “This is a property with great ‘bones,’ and while the previous owner renovated a number of units in recent years, most are still waiting for updates. The end result will be a highly competitive product in a multifamily submarket where vacancy rates and rent growth both consistently outperform the greater Baltimore metropolitan area.”
Tryko Partners and Investcorp are putting a large amount of capital into interior unit renovations. This includes the installation of individual washers and dryers, new windows, railings, roofing and siding for the garden buildings, and common area and lobby retrofits in the high-rise. Plans also consist of property-wide electrical upgrades and ample improvements to common areas, the onsite clubhouse, fitness center and pool.
Kahanow says the mix of units and various price points at Fairways and its amenities package distinguish it within the marketplace. Residents also enjoy tennis and volleyball courts, a business center, movie theater and car care area. The property is within miles of three accredited universities with more than 30,000 students and several thousand employees.
“Multifamily fundamentals in the Towson market make it a prime investment target, and this property is consistent with Investcorp’s approach of targeting high quality assets that we believe will produce attractive yields in major markets,” noted Investcorp’s Ryan Bassett, principal, real estate. “Additionally, we are pleased to have formed a new joint venture with Tryko Partners. Beyond assisting us in executing the capital plan to upgrade Fairways, this company has a deep local market presence that positions it to leverage economies of scale and deliver strong investment returns.”
Tryko Partners’ Baltimore holdings now total nearly 1,900 rental units within a five-mile radius. Its other properties include Loch Raven Village, Park Raven and Marble Hall Garden Apartments. The firm is also involved in the local nursing sector as owner and manager of the 120-bed Westgate Hills Rehabilitation and Healthcare Center.
Tryko Partners and Investcorp acquired financing for the $100-plus million Fairways purchase through a Wells Fargo on-balance-sheet loan. CBRE in Baltimore acted as the broker for the transaction. “This was an exciting acquisition process,” said Chad Buchanan, Tryko Partners’ chief investment officer. “We look forward to a long and beneficial partnership with Investcorp, which offers the support and strength of a global leader. We had been in conversation for some time and waiting for the right fit for a joint venture. Fairways has all of the characteristics we were looking for, along with superior upside potential.”