TODAY’S DEALS: W.P. Carey Grabs Pair of Georgia Apartment Assets for $46M

W.P. Carey-led investment group grabs 444 units in Georgia; HFF arranges financing for a 520-bed student-housing asset in California; and Red Capital provides a $3.85 million balance-sheet construction mezzanine loan.

W P Carey Inc acquire ApartmentsTucker & Chamblee, Ga.—W.P. Carey Inc. has acquired a 97 percent interest in two multifamily properties in Tucker, Ga., via the firm’s managed non-traded REIT CPA: 18 —Global. Co-investment partners, Silverpeak Real Estate Partners and Carroll Organization own the remaining interest. The total purchase price was $46 million.

Dupont Place Apartments features 217 units in Tucker, Ga., a suburb about 11 miles northeast of Midtown Atlanta. Gentry’s Walk features 227-units in Chamblee, Ga., which is located about 10 miles northeast of Midtown Atlanta. Both assets are within close proximity to major office submarkets like Northlake, Perimeter Center and Buckhead.

“These investments represented an opportunity to secure assets with strong in-place cash flow and the potential to enhance future returns through targeted capital improvements and the installation of a professional local asset management team,” says Gino Sabatini, co-head of global investments at W.P. Carey.

According to W.P. Carey, Atlanta’s Class A multifamily vacancy was 4.3 percent as of June 2015. Rents for the Atlanta Metro area are  forecast to increase by 2.9 per annum over the next five years. Underlying factors contributing to this trend include population and employment growth. Over the past five years, Atlanta was the fourth fastest growing city by population in the United States. In addition, its annual employment growth exceeds the 1.7 percent average for 82 major U.S. markets.

Capstone, J.R. Watson land $40.9M for Cal State student-housing development

San Bernardino, Calif.—A venture between University Park Promenade & Shops (an affiliate of J.R. Watson & Associates) and Capstone Development Partners has landed a $40.9 million construction loan to build The Glen at University Park, a 520-bed student housing development that will serve the California State University in San Bernardino, Calif.

HFF placed the three-year, floating-rate construction loan with Bank of the Ozarks. The HFF debt placement team was led by directors Adam Herrin and Charles Halladay.

The development should wrap up in September 2015. It will be located at the northwest corner of University Parkway and West Northpark Blvd. across from the school’s main entrance. Fully-furnished units will include five-bedroom/five-bath and four-bedroom/four-bath configurations in a townhome-style design. Amenities will include a 7,000-square-foot recreation building with a fitness center, lounge, media/gaming area, a business center and study rooms. There is also a resort-style pool, outdoor kitchen, barbecue area and green space.

The project represents the final phase of a 132-acre University Park master planned community that entered development in 2003.

RED provides $3.85M balance-sheet mezzanine loan for construction

Columbus, Ohio—RED Capital Partners LLC, the proprietary debt and equity banking arm of comprehensive capital provider RED Capital Group LLC, recently completed a $3.85 million mezzanine balance-sheet construction loan to an affiliate of Discovery Senior Living.

Discovery Village at Palm Beach Gardens will be a 120-unit Class A seniors housing community located in Palm Beach Gardens, Fla. When complete, the community will include 30 supervised independent living, 60 assisted living and 30 memory-care units.

The community will include amenities such as dining rooms, game room, club and bar, Bistro and ice cream parlor, pet park, fitness center, heated indoor therapy pool, movie theater, beauty salon, spa, barber shop, craft center and garden area.

The facility will also host a state- of-the-art Discovery Zone Media Center with cognitive brain fitness technology.

Discovery Senior Living is an award-winning, fully integrated, seniors housing development and management company based in Bonita Springs, Fla. Discovery operates 14 seniors communities with more than 3,500 units and is actively acquiring and developing in Texas and the southern United States.

Richard Hutchinson, president and CFO, Discovery Senior Living, says, “We are excited about continuing our long relationship with RED. Their experienced, thoughtful and creative approach to financing continues to allow Discovery Senior Living to expand its portfolio of world class communities in an efficient and effective manner.”

“Discovery Senior Living is one of the premier owner/operators in the country,” Kathryn Burton Gray, senior managing director for RED says. “We are pleased that, once again, they chose RED as one of their capital partners.”

“We are excited to be working with the Discovery team,” James Scribner, managing director for RED says. “We have had a great, long-standing relationship with Richard and his team.  For this transaction, creativity was essential – being able to work through the complexities of a mezzanine loan takes expertise and creativity. Additionally, our strong relationship with the first mortgage lender, Community & Southern Bank, was instrumental.”

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