Alterra Takes 348 Townhomes for $12M

ATLANTA-Miami-based Alterra Capital Group has acquired Sweetwater Cove, a 348-unit townhome community at 6850 Mableton Parkway, for $11.5 million. The seller was Sweetwater Cove Investors LLC.

Built in 1970, the 36-building community is located on 30 acres and includes two-story townhomes, a clubhouse, pool, playground and laundry facilities. The property, which is 86% occupied, will be renamed Mableton Reserve Townhomes.

"The property is located in an area that has undergone revitalization with a lot of new construction," Alterra founder Matt Papunen tells GlobeSt.com. "We've been looking to acquire property in Atlanta for a while and we felt this deal was undervalued."

Alterra plans to spend nearly $500,000 to renovate the property, including replacing roofs, building a new leasing center and soccer field, painting, landscaping, resurfacing the parking lot and adding new signage. Renovations will begin in the fall and are expected to be completed by the end of 2007.

The acquisition is part of Alterra's plan to invest in $80 million worth of stable and distressed B and C class multifamily property in Houston, Dallas and Atlanta. The firm raised $23 million in private equity for the initiative. The company's current portfolio consists of approximately 3,100 units in Alabama, Georgia, Tennessee and Houston and is valued at over $130 million. The company's goal is to grow the portfolio to 10,000 units by the end of 2008 with the assistance of institutional equity.

New York City-based the Pembrook Group provided a $10-million loan for the transaction, with managing director Brian Shelly facilitating the transaction. The bridge loan is floating rate with a term of three years. "A class B property can easily be as desirable as a class A property in terms of the economics and yet we have the added plus of serving residents often sorely in need of quality housing," says Pembrook Capital Management CEO Stuart Boesky.