"We started working with this buyer last October," comments Craig LaFollette, executive vice president with CB Richard Ellis'' Houston office. LaFollette, who led the CBRE team that represented seller Gables Residential of Atlanta, GA tells GlobeSt.com that during the negotiation process late last year, Francis Property Investments' equity disappeared.
"They really liked the deal, and kept after it," LaFollette remarks. "He came back to us in March and said he had everything lined up and wanted to buy it." Part of the equity the second time around came from a 1031 exchange. Though the buyer came equipped with a Freddie Mac loan, "they had 60% leverage," LaFollette comments.
LaFollette notes that the buyer, represented by David Joachim of local company International Realty Concepts, was, as he put it, "the needle in the haystack." For one thing, finding a buyer that would pay Gables' requested price was difficult.
"You see so few A deals being transacted," he comments. "Developers and owners haven't wanted to sell at today's cap rates. This was a below-market cap rate, and it took a unique buyer to get there." Though a sales price wasn't indicated, the Harris County Assessment District assesses the property at $33.3 million.
Completed in 2004, Gables Augusta at 2600 Augusta Dr. has a mix of one- and two-bedroom units. Unit sizes are between 767 and 1,155 square feet and the monthly rent ranges from $1,166 and $1,642.
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