Brookfield Acquires 19-Property Portfolio

Brookfield completes a $414 million portfolio buy; MG Properties Group acquires a 736-unit asset in Ontario, Calif.; and NorthMarq Capital arranges $20.2 million in combined acquisition mortgages from a bank.

Marina Shores

Charlotte, N.C.—Brookfield Asset Management has acquired a portfolio of 19 apartment communities with 4,892 units located in North Carolina, South Carolina and Virginia from Babcock & Brown Residential. The transaction was valued at $414 million, which equates to $84,627 per unit.

“The acquisition of this attractive portfolio adds to Brookfield’s significant multifamily platform and positions us for continued growth in this property sector,” says David Arthur, managing partner at Brookfield Asset Management.

The portfolio is concentrated in the Charlotte and Raleigh-Durham submarkets. Both areas are expected to see strong economic and population growth, factors that should translate into rent increases and heightened occupancy. Currently, the portfolio is 92 percent full, and financed with individual non-recourse first mortgage loans which have been assumed as part of the transaction.

Fairfield Residential, a Brookfield affiliate, will manage the portfolio. Brookfield plans to invest an additional $30 million to upgrade and reposition these assets.

MG Properties buys California asset for $95 million

Terracina

Ontario, Calif.—MG Properties Group has acquired Terracina, a 736-unit community located in Ontario, Calif. The sales price was $95 million, which equates to $120,076 per unit. The purchase was made in partnership with Rockwood Capital.

“As a property with growth potential resulting from physical improvements and superior customer service, this transaction is an excellent fit for MGPG’s in-house operations and construction management teams,” says Mark Gleiberman, president at MG Properties Group.

Terracina was built in 1988. Amenities include two common areas, a fitness center, two pools, tennis courts, mature landscaping and scenic waterways. The property is also within walking distance of a Ralphs grocery and Rite Aid pharmacy.

“We have been invested in the Inland Empire for more than a decade and believe in its economic potential to outpace much of California during the next decade,” says Justin Smith, senior vice president of investments at MG Properties Group. “We expect Terracina to benefit from renewed job growth driven by strengthening economic performance, an effect that we are already beginning to see in our regional portfolio.”

NorthMarq arranges $20.2M in combined acquisition mortgages from bank

Costa Mesa, Calif.—Michael Elmore, executive vice president and managing director of NorthMarq’s Los Angeles regional office, arranged combined acquisition financing of $20.2 million for West Bay Apartments located in Costa Mesa, Calif. These two market-rate multifamily properties contain a combined total of 158 units.

West Bay Apartments, located at 126, 131 and 161 E. 18th Street, contains 98 units and was financed at $12.7 million. West Bay Apartments, located at 2000 Parsons Street, contains 60 units and was financed at $7.5 million. Financing for both of these transactions was based on a “5 + 10″-year term and a 30-year amortization schedule. NorthMarq arranged this financing for the borrower, Advanced Real Estate Services, through its relationship with a national bank.

“The lender provided a hybrid loan that allowed for flexible intermediate term acquisition financing,” Elmore said.  “The loan is fixed for five years at 4 percent with a flexible prepayment that conforms to the business plan. There is also a “safety valve” in a 10-year floating rate after the initial term.”