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GARLAND, TX-A partnership, with 1031 exchange funds to spend, has acquired a third multifamily property in the metroplex. The value-add play rolls the deed to 154 units that went through two large price reductions before changing hands.

The Hills of Palos Verdes at 930 W. Interstate 30 opened at $9.1 million for a 100-day run on the market that generated a half dozen offers at far less than the ask, George Deuillet of Hendricks & Partners’ Dallas office tells GlobeSt.com. The deal closed at close to $6 million with the new owners teaming the exchange funds to a 10-year loan for $4.7 million at 80% of the acquisition cost, according to BMC Capital LP.

A family trust made up of MDH Realty Investment LLC of Los Angeles and GBK Realty Investment LLC of Andover, MA secured the financing from the Newark, NJ-based Prudential Mortgage Capital Co. BMC’s Steve Sieling arranged a package with two years of interest-only payments at a rate slightly above 6% and 30-year amortization. “It was a pretty vanilla transaction,” he says.

The 93%-leased Hills of Palos Verdes, built in 1983, has nine buildings with one- and two-bedroom apartments averaging 813 sf. The monthly rents are 79 cents per sf. “It’s a solid, clean asset, a solid class B, with great visibility on Interstate 30,” Deuillet says. Sunridge Management Co. of Dallas will manage and lease the 5.4-acre complex, sold by Elias Kalimian of New York City. Deuillet and Mark Hendricks in the brokerage house’s Houston office closed the deal.

Deuillet says the trust’s anticipated hold is five to seven years. “The upside is pushing the rents and riding the improving market conditions that we’re seeing,” he explains, citing the good condition of the just-sold asset. “It’s not a turnaround play.”

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