The same dynamics that are pushing these deals across the finish line--good local fundamentals, government backed funding--are also having an impact on smaller building trades. One local broker--the Firoozabadi Group of Marcus & Millichap Real Estate Investment Services--reports that it has 15 transactions under contract now, representing roughly $100 million in the aggregate that are expected to close within the next few months.
There are some differences between the smaller deals that are closing and their larger counterparts, Ari Firoozabadi tells GlobeSt.com. The smaller deals have been, not surprisingly, moving more fluidly to closing. They also tend to be characterized more by distress than much, but not all, of the larger deals that have closed lately. "Many of these deals are troubled assets that have been put on the market, or assets from owners that are experiencing financial distress. Buyers are buying short of the balance of the loan or buying above the balance."
On Friday, the Firoozabadi Group closed on a $5-million transaction in Arlington. It also recently closed on 3121 Mt. Pleasant Street Apartments in the District for $1.7 million. This deal first went on the market long before the current downturn; it was first marketed in 2007 when the tenant organization was offered their right of first refusal to purchase the property. E&G Group, the management and development partner eventually secured financing from the District of Columbia's Department of Housing and Community development on behalf of a new purchaser. The E&G Group will continue to manage the property.
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