TODAY’S DEALS: NorthMarq Arranges $40.4M for Portfolio in Pa.

NorthMarq Capital arranges $40.43M for a portfolio of Section 8 properties; Phoenix Realty acquires a $21.5M REO portfolio; and Grosvenor Residential Investment Partners acquires a 121-unit project in Chicagoland.

Allentown Towne House

Shillington, Pa.–David Farrell, senior vice president and managing director of NorthMarq Capital’s Kansas City Regional office, arranged first mortgage financing of $40.43 million for an apartment portfolio of five multifamily properties located in Shillington, Camp Hill, Allentown, Lancaster and Sunbury, Pa.

The properties contain a combined total of 960 multifamily units. Financing for each property was based on a 10-year term and a 30-year amortization schedule and was arranged for the borrower by NorthMarq through its seller-servicer relationship with Freddie Mac through its Capital Markets Execution program. Farrell says that each of the five properties is subject to age and income restrictions as part of HUD’s Section 8 Housing Assistance Payments Program.

Phoenix Realty acquires $21.5M REO Inland Empire portfolio

San Bernardino, Calif.—Phoenix Realty Group has acquired a portfolio of 432 apartment units from three properties in the cities of San Bernardino and Highland, Calif. The assets were purchased for $21.5 million from a lender that had taken back the assets in 2009 and embarked on an 18-month management effort that brought occupancy up to 95 percent.

The properties offer market-rate and government-subsidized units to renters employed throughout the Inland Empire by local employers like California State University San Bernardino and Arrowhead Regional Medical Center.

“A year ago, these properties were in poor shape due to low occupancies largely driven by poor management and a lack of maintenance,” says Edward Ratinoff, Phoenix Realty Group’s managing director of national acquisitions. “But aggressive management and capital improvements restored these properties into the type of middle-market, family-friendly apartments that our institutional real estate funds target. The improved conditions allowed us to obtain attractive financing from Freddie Mac.”

Coastline Real Estate Advisors worked to stabilize the properties over the last twelve months. The portfolio consisted of Ascot Park (160 units in 25 two-story buildings) and Summit Place (90 units in 10 two-story buildings) in San Bernardino, and Park Heights (192 units in 15 two-story buildings) in Highland.

Grosvenor Residential finances Chicago residential project

Hinsdale, Ill.—Grosvenor Residential Investment Partners I LP (GRIP), sponsored by Grosvenor Investment Management and KeyCorp Fund Management Group, has financed a 121-unit “for sale” residential project in Hinsdale, Ill. The fund provided a $9.3 million subordinated loan to acquire the project, complete with land development and vertical construction of 25 townhomes and 93 condominiums. Three residential lots adjacent to the project were also purchased in the acquisition.

GRIP is a private partnership that invests in for-sale residential projects and associated debt across the United States. The Hinsdale transaction represents the 15th investment for the $100 million fund, which is now 77 percent invested. The borrower is a subsidiary of Inland Opportunity Fund LLC, part of the Inland Real Estate Group of Companies Inc. The sites in Hinsdale are about 20 miles west of downtown Chicago.

“This is the seventh investment that the fund has made over the past 10 months, demonstrating that GRIP has become an important funding source for the homebuilding industry, evolving to meet the sector’s ever-changing needs,” says David Reiner, managing director of GIM.

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