PHOENIX—TruAmerica Multifamily and anaffiliate of Berkshire Group acquiredAvenue 25 Apartments in Phoenix in a joint venture for $35.4million. TruAmerica Multifamily is the investment firm formed byRobert E. Hart and The Guardian LifeInsurance Company of America. The off market transactionwas completed with pre-stabilization debt financing provided byCapital One Commercial Bank.

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Avenue 25 is TruAmerica's first Arizona purchase and theinvestment firm's twelfth acquisition in its inaugural year, whichincludes new acquisitions valued at over $612 million acrossArizona, California, Colorado and Washington.

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Avenue 25 is Berkshire's second Arizona acquisition and marksthe evolution of its presence in the Phoenix market.

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Phoenix is experiencing shifts in its economic conditions thatpresent an attractive investment environment. The apartment vacancyrate in the submarket is currently 4.4%, and among assets underfive years old, including properties like Avenue 25 Apartmentswhich was built in 2014, drops to 2.6%. Strong, diverseemployment growth is also trending up at a quick pace. Unlikeprevious economic cycles, almost all sectors are contributing tomore balanced job gains rather than a concentration in theconstruction industry.

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Greg Campbell, director of acquisitions atTruAmerica, tells GlobeSt.com, “We believe in therecovery. It's a more broad-based; not so construction-based as itwas in the past and that makes us a lot more comfortable. We'rebullish on Phoenix and we will definitely be looking there forfuture assets.”

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Avenue 25 Apartments benefits from high visibility along primarytraffic corridor Interstate 17 highway and is convenient to theU.S. 101/Interstate 17 interchange, which is a major regionaltransportation hub. The submarket houses several large corporateheadquarters in a range of industries from American Express toPetSmart and Safeway. TruAmerica plans to capitalize on thisconcentration of large employment centers by marketing to theworkforce throughout the region.

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“We like that it's located in a big job corridor; there are morethan 50,000 jobs within a one-mile radius. And there is not a lotof new construction, so not a lot of competition for new product,”says Campbell.

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The 254-unit apartment community consists of a mix of newlybuilt one- to three-bedroom floor plans, which includetop-of-the-line amenities. Avenue 25 Apartments is comprised of 19buildings on nearly nine acres of professionally landscapedgrounds. Amenity offerings include an electric car chargingstation, recreation center fitness center, pool area, dog park, andbusiness center. In addition, individual units include designerkitchens, faux plank flooring, private outdoor spaces and full-sizein-unit washers and dryers.

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Alon Shnitzer and Rue Bax ofAbi Multifamily represented the seller,NextGen Apartments, on the Avenue 25 Apartmentstransaction.

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