Elad Adds 1,073 Units to Condo Roster

BOCA RATON, FL-Elad Group of Florida, a Miami-based condo converter, has acquired a three-property multifamily portfolio aggregating 1,073 units from Gables Residential's parent, New York City-based ING Clarion Partners. A GlobeSt.com source says the deal probably carried a price tag of more than $200 million. Jack McCabe, CEO of Deerfield Beach-based McCabe Research & Consulting, tells GlobeSt.com, "the properties were priced separately." By his calculations, the total tab was between $362.6 million and $366.1 million.

This portfolio consists of Gables Camino Real, a nine-story, 235-unit mid-rise here; Gables Mizner on the Green, a 246-unit townhouse community overlooking Boca Raton Resort & Club; and Gables San Michele, a 592-unit townhouse community in Weston. "These three trophy properties were aggressively sought after by several investors," says Marc deBaptiste, principal in the local office of Apartment Realty Advisors.

"The Mizner asset did break an all-time record at $411,000 a door," McCabe says. "The Camino Real property went for $289,000 a door. I don't have exact figures for the San Michele, but it was priced at between $327,000 and $333,000 a door."

Multifamily assets in Palm Beach County commanded the highest average price per unit in the three-county Southeast Florida area, according to a first-quarter 2006 report from Miami Beach-based Terranova Corp. It says price-per-unit sales of multifamily properties in Palm Beach County rose 45% between 2004 and 2005, while the average price-per-unit sales in Broward County, where the Weston asset is located, rose 38% in the same year. A report from the area office of Marcus & Millichap confirms, "condo converters have steadily made their way up the coast from Miami."

On condition of anonymity, an area multifamily broker tells GlobeSt.com that pricing for this portfolio "probably was well in excess of the averages in both counties, although not as high as each property might have commanded individually." The average in Palm Beach County, according to Terranova, is $159,672 a unit, while the average in Broward is $139,946 a unit. "It is hard to imagine this portfolio went for much less than $190,000 a unit, which would take the total price north of $200 million," the broker says.

ARA marketed the properties individually and as a portfolio, he says. He along with Avery Klann and Sean Williams, ARA SVPs, represented the seller and were sole brokers in the transaction. Williams declined to disclose the exact price. Klann agrees with local market reports and tells GlobeSt.com that condo converters are also spreading to South Florida's west coast.

ING acquired locally based Gables nearly a year ago for $2.8 billion and has since disposed of some Gables assets in Texas and Atlanta. This January Elad acquired the Park at Sawgrass Mills in Sunrise for $74.1 million, or approximately $190,000 a unit.