JPI Swaps 522-Unit, Class A Deed for About $45M

Though the deal-makers aren't talking, sources familiar with the transaction confirmed the price for the Jefferson at Timberglen at 4607 Timberglen Dr. And, they say, it was about the right price for the times and the submarket. The four-year-old asset, sitting on 23.6 acres in the heart of the Dallas North Tollway corridor, is assessed at $31.3 million by Dallas County--a levy that's steadily declined since 2000.

Interest is running high for class A complexes in premier locations as low-cost financing leverages investors' purchasing power, Don Ostroff, director for Cushman & Wakefield of Texas Inc.'s multi-housing group, says of the Dallas/Fort Worth market. "People realizing the cyclical nature of real estate are willing to step forward," he says, "because they also realize in six to 24 months that we will have improvement in the real estate market."

The Jefferson at Timberglen sits in a submarket with a 91.6% occupancy in comparison to the metro's 88.9%, says Greg Willett, editorial director for M/PF Research Inc. in Carrollton. The submarket's standing, though, is deceiving due to giveaways that brought a flood of signings as "owners and managers bought some occupancy," he says with rent cuts and bonuses. As a result, the submarket's average class A rent dipped by 8.8% while the rest of Dallas slid 3.7%. At year's end, the area's median rent was $740 per month or 89.2 cents per sf. At the Jefferson, the low end has one-bedroom units of 731 sf renting for $955 and the high end, three-bedroom apartments with 1,619 sf bringing $1,875 per month.

Gerald P. Cox of the Novato, CA-based RealFacts, which keeps watch on class A properties with 100 or more units, says the Timberglen with its concierge services and resort-style amenities undoubtedly got a lot of attention from the investment market. "From what I've heard anecdotally is there's not enough product out there," he says of the class A sector.

The Timberglen is the fourth class A asset to be bought by the JV since it launched in July 2002. Mid-America holds one-third interest. The transaction was brokered by Mark Stymiest, Bill Baxter and Dirk Goris, a CB Richard Ellis Inc. team in Dallas.