SILVER SPRING, MD-The Praedium Group, a New York City-based national real estate investment firm, and Fairfield Investment Co. have acquired the Hampton Hollow Apartments, a 176,166-square-foot, 240-unit apartment building at 3408 Hampton Hollow Dr. here. The property traded for $31 million.
The transaction is a value-add play for the buyers, Chris Hughes, principal of Praedium, said in a prepared statement. The company plans to reposition the property and take advantage of strengthening market fundamentals.
Praedium acquired Hampton Hollow through the Praedium Fund VII LP, a $900-million private equity fund with purchasing power of $3 billion. Currently, there is over $500 million available for investment through Praedium’s Fund VII. The company was unable to comment in time for GlobeSt.com’s publishing deadline.
With the market now recovering, value-add deals such as this one don’t have a significant downside like in the boom years. Case in point is the Enclave, an apartment building here that went into receivership last year. Stellar Rental Community acquired it at the height of the market as a value-add play, penciling in exit rents that unfortunately did not materialize when the downturn began.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
