WASHINGTON, DC-Starwood Capital Group and Bainbridge Companies have acquired a 1,626-unit multifamily portfolio spread across Virginia and Maryland from Equity Residential. The terms of the off-market transaction were not disclosed other than that the two firms are investing $300 million in the acquisition and subsequent upgrades to the seven communities. Jones Lang LaSalle’s Scott Melnick and Al Cissel brokered the transaction.
The deal follows a transaction last month in which a joint venture between Dune Real Estate Partners and Pantzer Properties closed on 8 apartment buildings for $460 million. A third large portfolio sale will be closing within the next 45 to 60 days, Melnick and Cissel tell GlobeSt.com. “Yes, I would say this is a trend,” Cissel says. “That is because the area is so desirable and investors want to be here. So people are willing to put their money to work.” This third deal involves more than 2,000 units and is focused in the Baltimore area, he says.
The Starwood, Bainbridge JV secured Freddie Mac financing for the deal – a seven-year loan at 4.87%. The units in the buildings, which were delivered to the market between 1987 and 2002, average about 950 square feet each. The renovation plans call for upgrading amenities, interiors, exteriors, landscaping and signs. Bainbridge Management will manage the properties. “These particular assets are excellent properties but they are somewhat older and area ready to have some improvements done to them,” Richard Schechter, CEO and managing principal of multifamily at Bainbridge, told GlobeSt.com. He adds that there is not a particular hold period for this investment, although it will likely remain with the new owners for at least the medium term.
The 7 properties range in size from 190 to 290 units. They are Amberton Apartments, in Manassas, VA; the Reserve at Regency Park Apartments, located in Centreville, VA; Westfield Village Apartments, based Centreville, VA; Saddle Ridge Apartments in Ashburn, VA; the Reserve at Towne Center Apartments in Potomac Falls, VA; Woodside Apartments in Lorton, VA; and Clary’s Crossing Apartments, in Columbia, MD.
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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.
