TODAY’S DEALS: Pegasus Investments Closes $7.4M Denver Multifamily Buy

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Pegasus Investments closes a $7.4 million Denver buy on behalf of a high net worth family; Pathfinder Partners wraps up an opportunistic play with a $1.9 million sale in Pheonix; and NorthMarq Capital completes three multifamily transactions totaling $58.1 million on behalf of one borrower.

Pegasus Investments closes $7.4M Denver multifamily buy

Denver—Commercial brokerage and advisory firm Pegasus Investments has completed the sale of 44 newly constructed, Class A townhomes within Sage Creek, a 174-unit condominium development in Thornton, an affluent Denver suburb. The portfolio is 100 percent occupied and the cap rate exceeds 8 percent.

Pegasus represented the buyer, a Southern California-based high net worth family. The client was looking for a 1031 exchange following the sale of 10 condo units in West Hollywood they had developed. ARA represented the seller.

“We leveraged a longstanding broker relationship to source this off market opportunity for our client and obtain an exceptional yield,” says Trevor Nelson, Director at Pegasus Investments. “The quality of the units, desirable suburban location, high occupancy and ability to increase rents, in addition to the significantly above market returns, makes the portfolio an extremely attractive and stable long term investment for the client.”

Financing for the purchase was arranged by Pegasus Capital Markets Inc., the mortgage brokerage affiliate of Pegasus Investments. The 10 year, non-recourse loan was originated by a CMBS lender and features a fixed interest rate of 4.57 percent and interest only payments for the entire term of the loan, which enables the borrower to maximize its cash on cash returns from the portfolio.

Pathfinder sells Phoenix asset to Atrium Apartments

Path_ShorewoodPhoenix—Opportunistic real estate investor Pathfinder Partners LLC has closed the $1.9 million sale of Shorewood Apartments, a 21-unit community located in the midtown neighborhood of Phoenix. The asset was picked up by Washington-based Atrium Apartments LLC.

Pathfinder and Avenue North acquired Shorewood in February 2012 in a receivership sale and subsequently embarked on a $500,000 capital improvement program.

“We were drawn to the property because of its central, gentrifying location, large floor plans with expansive deck and balconies and mid-century modern charm,” says Lorne Polger, senior managing director of Pathfinder.

The 1960-built community was 100 percent occupied at the time of sale. Improvements overhauled the landscaping, refinished and expanded the pool area, replaced the roof and air conditioning units, and repainted the property. Interior updates included the installation of new floors, updating finishes and fixtures, and adding new appliances and glass-tile kitchen backsplashes.

NorthMarq completes three multifamily transactions totaling $58.1M on behalf of borrower

Los Angeles—Michael T. Elmore, executive vice president/managing director of NorthMarq Capital’s Los Angeles based regional office arranged the refinancing of three multifamily properties, Cantabria Apartments, Serena Vista and Villa Del Sur worth a combined $58.1 million. NorthMarq worked closely with the borrower, Advanced Real Estate Services, on all three transactions.

-Serena Vista: This 172-unit multifamily property, located at 10300 La Hacienda Avenue in Fountain Valley, Calif., was refinanced at $27.3 million. The transaction was structured with a 10-year term and 30-year amortization schedule. Financing was provided by Fannie Mae on a cash out 1.25 debt coverage ratio. The loan paid off the existing loan and returned all of the equity from a 2009 purchase.

-Villa Del Sur: This 112-unit multifamily property, located at 2701 W. McFadden Avenue, Santa Ana, Calif., was refinanced at $12.55 million. This Fannie Mae loan had the same terms as Serena Vista. This was NorthMarq’s second financing of the asset and it provided the borrower with nearly $5 million in excess cash out for future multifamily acquisitions.

“These were the fourth and fifth Fannie Mae loans in the past eight months for the borrower—excellent terms and flawless execution yet again,” says Elmore.

-Cantabria Apartments: This 97-unit multifamily property, located at 7835 Oleander Circle in Buena Park, Calif., was refinanced at $13.8 million. The transaction was structured with a 30-year term with five-years fixed rate. followed by a 25-year floating rate period. NorthMarq arranged financing for the borrower through its relationship with a national bank, who was willing to implement an aggressive 1.15 debt coverage ratio to accommodate a refinance of a 2007 vintage CDO loan that had been extended and was under forbearance.

“The economics were outstanding with a 3.38 percent fixed five-year rate, the loan payoff and a partial return of capital,” says Elmore.

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