DALLAS-A private investor from San Diego has seized control of side-by-side multifamily properties in a land play for a foothold in the city's hottest condo corridor. The complexes, bought for full value of an outstanding $3-million note, will be scraped and the site rebuilt with condos.
"That's the highest and best use. He's buying them basically for the dirt," says Robert Aiello, partner in Wells Asset Management Inc., who teamed with Mike Wells to close the deal for the seller, a Kansas City conduit lender holding the note and poised to foreclose on a Denver-based partnership. The Versailles and Marrakesh Apartments, totaling 77 units, sit on 109,200 sf of prime infill land at 4625 Cedar Springs Rd., right beside the under-construction Westside Condos, an 83-unit, gated development.
Aiello says the Oak Lawn property was marketed strictly to condo developers. He says the winner used 1031 exchange funds from commercial sales in San Diego and teamed it to a $2-million loan with two-year, interest-only terms from Stillwater National Bank in Oklahoma. Wells Asset Management arranged the financing.
Aiello says the new owner is in the process of pulling together the design team to develop the site, which now holds two 37-year-old complexes that were 75% leased at sale time. Units are one- and two-bedrooms, averaging 863 sf and renting for 84 cents per sf.
The deal closed in a 30-day start to finish, with six offers going on the table. "Once we saw the location, knowing that market, we knew we'd be able to get the bank's full-market value," Aiello says. "I had some people chasing this thing, but this buyer stepped up quick."
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.