Three Townhome Properties Fetch $50M

GREENWICH, CT-Prescott Capital Management, LLC has acquired three recently completed rental townhome communities here from locally based developer Fareri & Associates for $50 million.

Prescott Capital, the investment and asset management unit of the New York City-based Prescott Group, LLC, will convert the properties, which feature a total of 34 luxury units, to condominiums.

The portfolio includes Milbank Commons and Field Crest, which consist of 17 and seven luxury townhomes respectively, that are both located several blocks from Greenwich Avenue. The third property, Holly Hill, consists of 10 luxury townhomes located directly off West Putnam Avenue (Route 1).

Daniel Steinberg, managing director of Prescott, says that about two-thirds of the units are currently rented and will be converted to condos upon lease expiration. He says the process of obtaining the necessary regulatory approvals to convert the properties to condominium should be completed in the next several weeks.

"These newly constructed buildings are built to the highest standard. Given that they are already completed and are in excellent physical condition, the units can be marketed immediately and sold into an extremely strong and robust market," Steinberg says. "Our investment is enhanced by the fact that the acquisition does not have to account for construction and market timing risks."

He adds that while definitive asking prices for the units have yet to be set, the units will be priced somewhere from between $1.2 million to $1.3 million "on the low end" to $3 million "on the high end." Prudential Connecticut has been hired as the exclusive marketing agent for the properties, Prescott reports.

A week ago, Prescott Capital acquired a portfolio of six retail outlet centers in California, Nevada, Missouri, Minnesota, Michigan and Georgia from Horizon Group Properties, Inc. of Chicago in a deal valued at more than $100 million. Prescott currently is a preferred equity provider to RMS Construction of Stamford, which is building 170 townhomes in Stamford. The company's other Connecticut asset is 8-10 Wright St., an 80,000-sf commercial office building in Westport.