TODAY’S DEALS: Berkadia Arranges $73.7M for a Georgia Apartment Acquisition
Berkadia arranges acquisition financing for a Steadfast subsidiary; Bascom and Oaktree complete another purchase; and Community Development Trust and Peak Capital Partners acquire and preserve two affordable housing properties.
Suwanee, Ga.—The Austin office of Berkadia Commercial Mortgage has arranged $73.7 million for The Residences on McGinnis Ferry, a 696-unit community located in Suwanee, Ga. Senior Vice President Matt Greer worked with the borrower, STAR McGinnis Ferry LLC—an indirect wholly owned subsidiary of Steadfast Apartment REIT Inc.—to secure the 10-year, floating-rate financing through Berkadia’s Fannie Mae Program.
The borrower used the funds to acquire the asset. Terms include a 1.85 percent variable rate, five years of interest-only payments, a 75 percent LTV and a 30-year amortization schedule.
“Ongoing employment growth and limited supply is fueling strong demand in the greater Atlanta market,” says Greer. “Our regional Fannie Mae team is based in Atlanta, so we were able to leverage our local expertise to provide the client with the resources it needed to capitalize on these opportunistic market conditions.”
Located at 4021 McGinnis Ferry Road, the community was 96 percent occupied at the time of sale. The large, 86-acre site sits 32 miles outside of Atlanta. Amenities include two pools, a business center, running and biking trails, and tennis courts.
Bascom, Oaktree grab 408 units in Arizona
Glendale, Ariz.—The $250 million venture by The Bascom Group and funds managed by Oaktree Capital has acquired Indigo Creek Apartments, a 408-unit luxury community in Glendale, Ariz. The purchase price was $40.5 million. Bascom Arizona Venture acquired the asset with $35 million in debt financing provided by Los Angeles-based portfolio lender Mesa West Capital. CBRE arranged the financing for the purchase, and Marcus & Millichap represented the buyer and seller on the transaction. Arizona-based Morrison, Ekre & Bart Management Services will handle onsite management.
“Indigo Creek provided us with an exceptional opportunity to acquire an ‘A’ quality multifamily property in a prime infill location, well below replacement cost, with significant upside with our value-add program,” says Mark Brotherton, portfolio manager of Bascom Arizona Ventures. “Indigo Creek is our 12th acquisition since August 2012 in the state of Arizona. We are very excited about our newest acquisition and look forward to commencing our value-add program as soon as possible.”
The 1998-built asset consists of 30 two- and three-story buildings with three swimming pools and two spas. Additional amenities include a 24-hour fitness center, controlled entry, common area Wi-Fi, barbecue areas and detached garages.
This was the fifth multifamily acquisition closed by the Bascom/Oaktree Venture, which has also acquired The Springs Apartments, a 320-unit garden style community in Corona, Calif., in June; The Edge at Traverse Point, a 296-unit garden style community in Henderson, Nev.; The Reserve at Heritage Oaks, a 444-unit garden style community in Tallahassee, Fla., in July; and the Laurels at Overlook Park in Sandy Springs, Ga., earlier in October.
CDT, Peak Capital Partners preserve two affordable housing properties
New York—The Community Development Trust (CDT), which provides capital for the preservation of affordable housing, and Peak Capital Partners, a company that owns and manages conventional, affordable and student apartment assets across the country, announced their partnership in acquiring two properties, Pebble Creek Apartments in Southfield, Mich., and Traditions of Holland in Holland, Mich. The two properties total more than 375 units of affordable housing, available to lower-income families in each community.
Pebble Creek Apartments was acquired for $16.9 million and included a $3.3 million investment from CDT. Built in 1996, Pebble Creek Apartments consists of 256 units of affordable housing. Traditions of Holland was acquired for $7.2 million, with a $1.8 million investment from CDT. Built in 1996, Traditions of Holland consists of 120 units of affordable housing. All of the units at both properties are affordable to families with household earnings below 60 percent of the area median income.
“Our investment in Pebble Creek Apartments and Traditions of Holland will ensure that lower-income families in these communities will continue to have access to quality, safe, and affordable housing,” says Joseph F. Reilly, president and CEO of CDT. “We are grateful to our partners on this project, Peak Capital Partners, and we look forward to the opportunity to work together again.”
As a part of CDT’s equity program, current plans for the two properties include a combined $1.5 million of capital improvements over the next four to five years, which will include parking lot improvements, full roof and gutter replacements, and various energy and water/sewer efficiency improvements, including installation of low-flow toilets, shower and faucet aerators, and LED lighting fixtures.
The acquisition of Pebble Creek Apartments and Traditions of Holland furthers CDT’s commitment to investing in affordable housing and working with partners that share their mission of making a positive difference in residents’ lives and neighborhoods, for the long term. As a CDFI and private REIT with a social impact mission, CDT operates as a double bottom line organization by utilizing creative financial solutions to provide debt and equity capital to underserved real estate markets, all while seeking attractive returns for shareholders.