TODAY’S DEALS: Continental Real Estate Companies Brokers $15M Apartment Sale

Continental Real Estate Companies has completed a $15 million apartment sale in Florida; Hendricks & Partners brokers the sale of Palms Patio Apartments in San Diego; and Venture West Funding has arranged $10.2 million in loans with CapitalSource.

Seabreeze Harbor Apartment Homes

Riviera Beach, Fla.—Continental Real Estate Companies has completed the $14,980,000 sale of Seabreeze Harbor Apartment Homes. The 520-unit complex includes 37 low-rise buildings located at 2304 North Congress Avenue in Riviera Beach, Fla.  The property was approximately 50 percent occupied at the time of sale.

Peter Mekras, vice president at CREC, represented the seller, a private Miami-based owner and operator who bought the property for $11 million in September 2009. The new owner is planning to renovate, rebrand and reposition the asset. CB Richard Ellis Capital Markets secured the buyer’s financing, a non-recourse loan from a balance sheet lender.

“The nearly $15 million sale of Seabreeze Harbor demonstrates that a recovery in Florida’s multifamily market is in its early stages,” says Mekras. “We are beginning to see a return to conditions where non-stabilized assets poised to benefit from value-add strategies are again desirable to buyers.”

Hendricks brokers $3.55M sale of property at highest price in submarket

San Diego–Hendricks & Partners represented the seller in the sale of Palms Patio Apartments, located at 6280 Acorn Street in San Diego, Calif. The 32-unit apartment community was sold for $3,550,000, at a cap rate of 6.68 percent.

Multiple offers were made for the property, the sale of which represented the highest price paid for an apartment complex in its submarket during the past year, says Hendricks & Partners.

The property underwent extensive renovations and a lease-up program by the seller before hitting the market. It was on the market for two and a half months before going under contract; the escrow period was 60 days.  The seller was Crown Acorn LLC, which was managed by Silverberg Development Corp. of Tarzana, Calif. and Crown Acquisitions Inc. of Laguna Beach, Calif. The buyer, LHI, LLC of Poway, Calif., paid all cash for the property.

Palms Patio consists of four eight-plex buildings, with 20 one-bedroom and 12 two-bedroom units. The property is located near El Cajon Boulevard and College Avenue, less than a mile from San Diego State University.

Venture West Funding arranges $10.2M in loans with CapitalSource

Manhattan Beach, Calif.—Venture West Funding Inc., a mortgage company based in Manhattan Beach, Calif., has arranged $10.225 million in loans on two apartment buildings in the Hollywood area.

The first is a $6.53 million non-recourse loan secured by a 75-unit rent controlled building. The second loan is $3.7 million interest only for the first two years secured by a 26-unit non-rent controlled building.

Tony Fire, a senior loan consultant for Venture West Funding, arranged loans on both properties with five-year fixed rates under five percent for a local investor. The loans were structured at 75 percent loan to value and placed through Venture West’s relationship with CapitalSource.

“Our client wanted to lower their debt service while still maximizing the leverage on the buildings,” says Fire. “The reduction of their mortgage payments will allow them to compete more effectively in the market going forward.”