Cobblestone on the Lakes, Fort Myers, FL

FORT MYERS, FL—Sponsor ESG Kullen has acquired 189 units and the majority ownership at the Cobblestone on the Lakes fractured residential condominium property here.

New York City-based ESG Kullen, which is active in the South Florida distressed and value-add multifamily investment markets, secured $33 million from Pembrook Capital Management LLC of New York City in connection with the deal. The financing consists of a $24.9-million first mortgage bridge loan and an $8.1-million preferred equity investment.

A portion of the Pembrook financing was used to complete the acquisition, which gives ESG Kullen majority ownership of the 290-unit complex.

The remainder of Pembrook's commitment supports ESG Kullen's business plan that is now focused on selling 40 existing vacant units and completing construction of 42 partially constructed units and acquiring additional units as they become available.

“One of the opportunities for private lenders today is to provide financing solutions for residential condominiums,” says Stuart J. Boesky, CEO of Pembrook. “This is an area where banks and other traditional lenders may not be able to play in the current regulatory environment, and yet there are quality deals available that work well for alternative lenders like Pembrook.”

Pembrook is a real estate investment manager that has originated or participated in investments totaling more $1.4 billion since it began investing in 2007.

Berkadia senior director Tal Frydman, director Yoav Yuhjtman and associate director Nicholas Perrone of Berkadia's South Florida office, along with senior director Jason Stanton of Berkadia's Tampa office, arranged the sales transaction on behalf of ESG Kullen and the seller, Gestion Sebring LLC, a real estate investment firm based in Toronto.

“The buyer obtained a well-located, desirable property with considerable upside potential in one of Florida's fastest-growing metros,” says Frydman. “Our analysis shows that current in-place rents are well below comparable properties in the area.”

Instant Insights /

NYC-Based Firm Buys 189 Units of Fractured Fort Myers Condo Property

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