Beacon Builds Atlanta Portfolio with $53M Purchase
- Aug 27, 2020
Beacon Real Estate Group has expanded its Atlanta area holdings with the acquisition of 53 West, a 266-unit garden-style community in Gainesville, Ga., from Varden Capital Properties and Tellus Partners for $53.2 million. The purchase comes weeks after Beacon closed on the acquisition of two other multifamily properties in the market for a combined total of about $100 million in investments.
The Miami-based firm has been aggressively pursuing multifamily acquisitions in the Atlanta market. Beacon acquired the 168-unit Domain at Cedar Creek and 164-unit Gateway at Cedar Brook in the Decatur, Ga., submarket for $46.1 million from Audubon Communities, according to Yardi Matrix data. Those sister properties were completed between 1970 and 1972.
Located on more than 24 acres at 1000 Woodacres Road in the affluent Gainesville/Hall County submarket, 53 West was completed in 2019. The Class A community is 99 percent occupied. In November, Varden Capital Properties received a $34 million loan from NXT Capital to refinance the asset. Varden developed the multifamily property, formerly known as Mundy Mill Apartments, in partnership with Tellus Partners and Buckhaven Construction Services. 53 West has one-, two- and three-bedroom units and community amenities including a fitness center, carwash, clubhouse with lounge, coworking space, cyber lounge, game room, dog park, outdoor kitchen with fireplace and TVs and a saltwater swimming pool.
Strong Tenant Demand
Noting that the firm does not overreact to short-term trends and closely examines the fundamentals and surrounding area of a potential acquisition, Beacon Managing Partner Carlos Imery said in a prepared statement 53 West checked every possible box for the firm.
Richard Kulick, Beacon managing partner, noted tenant demand has been strong, citing the large number of professionals who are relocating to high-quality suburban communities. He noted 53 West is one of the few Class A residential offerings in Hall County. The Gainesville/Hall County submarket is an economic anchor of the northeast Atlanta metro area and is home to more than 350 companies and manufacturing firms. More than 100 businesses have moved to the area or expanded recently, adding 5,500 jobs and $1.2 billion in capital investment since 2015.
Beacon said the submarket has been particularly resilient during the COVID-19 pandemic, losing only 7.3 percent of its jobs as of May compared to the national average of 13.2 percent through May. The firm also noted the pandemic has caused minimal rent deferment at 53 West underscoring the strong demographics of the submarket and its ability to preserve jobs during challenging economic conditions.
Cushman & Wakefield’s Robert Stickel and Alex Brown marketed 53 West on behalf of the seller. Beacon obtained acquisition financing from Freddie Mac and Berkadia. At Berkadia, Mitch Sinberg and Scott Wadler arranged the financing.
Beacon owns more than 6,000 multifamily units in the Southeast with a strong focus on secondary markets. The firm also has nearly 1 million square feet of office and retail properties in its portfolio.