Two Birmingham Apartments Change Hands
- Mar 12, 2014
Birmingham, Ala.—Private investor EBSCO Watchman Drive LLC. has obtained acquisition financing for its purchase of two adjacent apartment properties in Montgomery, Ala. The financing is a Freddie Mac CME loan for an unspecified amount, in a deal originated by Maryland-based Beech Street Capital.
The properties are Bell Station and Watchman Court Apartments, and all together they total 252 units. The two properties were previously operated by separate owners. The larger of the two—Bell Station Apartments, with 224 units—was taken back in foreclosure by Fannie Mae in 2012.
During receivership, Fannie Mae and its management company spent a significant amount to upgrade units and complete deferred maintenance. Bell Station’s amenities include two pools, two clubhouses, a fitness center, and two car wash stations.
Watchman Court, with 28 units, has limited amenities, but its units include large layouts, washer/dryers, fireplaces, and ceiling fans. When the properties are combined, Watchman Court residents will be able to access the amenities offered at Bell Station Apartments.
Jimmy Adams of Multi Housing Advisors brokered the sale of the property. This is the first transaction to close since Beech Street and MHA joined together in an alliance. The strategy provides Beech Street’s clients with access to local broker intelligence, while MHA’s client have direct access to the capital markets.
Adams notes that the purchase of the properties is an example of investment activity in secondary and tertiary markets beginning to recover. “Investors are more receptive today to acquiring assets in non-core markets like Montgomery,” he says. “We expect a significant uptick in sales this year throughout Alabama and Mississippi.”
According to ARA’s most recent report on the Birmingham apartment market, construction of new product on the region — and thus the potential for supply to outrun demand — isn’t as robust as in other Southeastern markets. As of late 2013, only five projects totaling 1,023 units were under way, with seven more planned. By contrast, 32 were under way in Charlotte and 46 planned, while in Raleigh-Durham, 38 were under way and 38 planned.