Tarragon Rental Sells for More Than $116M

"With this successful transaction, Tarragon looks forward to continuing its role in the redevelopment of Hoboken, where we and our partners control almost 20 acres of land proposed for development of rental and for-sale housing, a public swimming pool and community center, parks, a multi-screen theatre and retail uses," says Williams Rosato, president of the New York City-based Tarragon Development Corp., a unit of parent Tarragon.

The building is located within this city's Upper Grand redevelopment area, and was Tarragon's fifth building in the eight-block zone. The company is currently moving forward with construction of the 112-unit 900 Monroe building.

The deal was brokered by Cushman & Wakefield's Metropolitan Area Capital Markets Group, specifically Andrew Merin, Jose Cruz, David Bernhaut and Gary Gabriel. And Tarragon had a mind to sell the building from the start, although not necessarily as a rental property.

"Tarragon initially started construction as a for-sale condominium property," Cruz says. "When they anticipated shifting investor demand in the market, the project was redirected to deliver the building unoccupied. This would allow the buyer the flexibility of either operating it as a rental community or starting condominium sales. The company should be commended for this timely and intelligent business move."

"The high level of investor interest and an ultimate record per-unit sale price reflect incredible demand for multifamily product in the Hudson River 'Gold Coast' market," says Merin, noting that the offering drew more than 30 bids in three rounds. "Because many institutional investors are underweighted in multifamily holdings in the Northeast, when something of this caliber comes to market it's highly subscribed."

Cruz says that "the building has received significant tenant attention. The lease-up is ahead of schedule."