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DALLAS-After spending just two years in Texas, the New York City-based Merit Acquisitions LLP is planning its retreat, bringing out an eight-property multifamily portfolio with a combined ask of $124.9 million. The 1,784 apartments, all class A except 102, are located primarily in suburban markets of Dallas/Fort Worth and Houston.

Norman Eastwood and Gerald Luterman in Marcus & Millichap’s Dallas office have set into play a “take one or all” strategy to hawk a package with assumable debt ranging from $3.8 million for the lone class B property in Arlington to $17 million for a class A in Houston. The team expects each asset will bait at least 10 offers. The properties, built between 1997 and 2002, have an average monthly per unit rent of $849.

The offering’s financials have a projected first-year cap rate of 7.22%, according to Eastwood. Total monthly payments range from $36,289 to $184,713. Loans, with terms of five to 40 years, have lockout periods up to September 2006 and four assets tied down with yield maintenance pre-payment penalties. Mortgage interest rates range from about 4.9% to 8.8%.

The debt leverage could be the stickling point for an institutional investor eyeing a portfolio acquisition since most “do not take anything over 60%,” a real estate source tells GlobeSt.com. The issue is offset, though, by the lack of class A product on the market in Dallas and the quality of Merit’s portfolio. “Other than this portfolio, there is only a handful of other class A deals, perhaps just five, in Dallas/Fort Worth on the market today,” the source says.

Many investors are eyeing the upside in class A product as concessions burn off. The competition is such that two class A complexes sold in back-to-back trades late last week, the details of which will come out Friday on GlobeSt.com.

Merit principals Mark Krugman and David Shweky could not be reached for comment about the disposition. Their buying spree began in February 2002 with the 102-unit, class B Brazos Park at 2008 Terlingua in South Arlington. Merit bought the 16-building asset for $4.1 million and immediately undertook a $650,000 renovation, financing the deal through Deutsche Bank. Today’s asking price is $5.4 million.

In March 2002, Merit, again financing through Deutsche Bank, paid about $19.8 million for the 302-unit, class A Haverhill Apartments at 6889 Hightower Dr. in North Richland Hills, according to a previous GlobeSt.com interview with Krugman. It’s now on the market for $19 million.

At that time, Merit had four more deals in the hopper and then rolled in another two before the buying spree came to a halt. The other North Texas holdings are the 220-unit Fairways at 801 Highway 30 in Mesquite, listed at close to $15.8 million; 224-unit Legends at the Lake at 923 Yellow Jacket in Rockwall, $17.2 million; and 202-unit Villages at Fossil Creek, with room for expansion at 6700 Sandshell Blvd. in Fort Worth, $14.5 million. The Houston properties are the 174-unit Villages of Lake Jackson at 504 Highway 332 in Lake Jackson, listed for $11.8 million; 240-unit Village of Briar Forest at 14504 Briar Forest in Houston, $18 million; and 320-unit Park Lakes Apartments at 9955 Buffalo Speedway in Houston, about $23.3 million.

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