The approximately 6,500 units involved in the sale once served as collateral for two defaulted bond issues. Emmes purchased the mortgages on the portfolio three years ago and then worked with the receivers to upgrade the neglected buildings.
Emmes paid $272 million and spent another $50 million on improvements. The firm retained the 1,800-unit, 124-acre Lynnewood garden in Cheltenham Township, PA that it acquired in the 1997 transaction.
Andrew Davidoff, president and CEO of Emmes, notes that no government subsidies were involved in the restoration of the apartments, which are subject to New York City rent stabilization regulations. "By restoring physical comfort and a sense of security to these communities, we demonstrated that investment in affordable, middle-class housing can be sound and profitable," he says.
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