The purchase price represents a cap rate of 9.07%. "This is part of an overall multifamily asset sale that we expect will be in the range of $100 million to $150 million," Colonial chairman/CEO Thomas H. Lowder tells GlobeSt.com. The overall cap rate is expected be under 9%.
"We are selling multifamily assets in smaller markets, thereby creating opportunities to reinvest the funds into other property types," Lowder says. Colonial will continue to manage the properties for CMS.
The 608-unit Alabama portfolio comprises the 104-unit, 21-year-old, 95.2% leased Colonial Village at Hillcrest in Mobile; the 200-unit, 25-year-old, 93%-leased Colonial Village at Monte D'Oro in Birmingham; and the 304-unit, 26-year-old, 94.4%-leased Ski Lodge in Tuscaloosa.
The 328-unit Florida portfolio is made up of the 176-unit, five-year-old, 97.67%-leased Colonial Village at Oakleigh and the 152-unit, 19-year-old, 95.4%-leased Colonial Village at Cordova, both in Pensacola.
The average age of the portfolio after completing all sales is expected to be under seven years, Lowder says.
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