ARLINGTON, TX-Third-quarter multifamily asset sales have gotten off to a rousing start, with three unrelated transactions crossing closing tables in the city and its close-by neighbors. In all, 410 units have been swapped, including 152 in an off-market deal.

Second-quarter sales for the sector were somewhat sluggish so the uptick validates brokers’ predictions that closings would be relatively brisk in Q3. The off-market trade was Tealwood Apartments, a 20-year-old class B asset at 6400 Tealcove Dr. in Arlington. Also sold were two class C’s: the 144-unit Plaza at 400 Ralph St. in White Settlement and 114-unit Shady Valley Square Apartments at 3206 Green Tee Dr. in Pantego.

Arlington continues to be a hot pick of the day due to the rising Dallas Cowboys’ stadium beside the Texas Rangers’ ballpark. Tealwood Apartments has been sold to a 1031 exchange investor from Portola Valley, CA, who used proceeds from an office building sale in Denver to pick off the 5.35-acre Tealwood Apartments at the intersection of US Hwy. 287 and Interstate 20 where a Wal-Mart Supercenter is coming out of the ground. Its seller was Tealwood Arlington Associates Ltd., a Dallas developer who built it in 1985.

The complex, in line for cosmetic upgrades, was 90% leased at sale time. Its one- and two-bedroom units average 643 sf; rents are $500 to $750 per month.

Hank Glasgow Jr. and his father, managing partners in Wildwood Realty Partners of Dallas, represented the Northern California buyer, who had been referred to them for a replacement property. “We were able to identify 120 properties that matched the specific acquisition criteria our client provided,” the younger Glasgow says. “Then, it was just a matter of old-fashion phone work to uncover Tealwood.” Debbie Hobbs of Don Luckadoo Co. in Dallas represented the seller.

In the West Fort Worth town of White Settlement, Boston-based Lindahl Group bought the Plaza, its second asset in the metroplex in an ongoing push to accumulate thousands of units in Texas. Next week, a 356-unit complex in Dallas/Fort Worth rolls into the portfolio, according to Justin Meszaros, acquisitions director, executive vice president and partner of David Lindahl, a nationally known value-add investor.

Meszaros says the Dallas/Fort Worth goal is to buy another 1,000 to 1,500 units within six months–all class C and class B for an anticipated “three- to four-year hold.”

The Apartment Realty Advisors’ team in Dallas of Chris Epp, Jordan Cortez and managing broker Brian O’Boyle laid the deal on Lindahl’s table. The Plaza will be renamed to the Legacy, Meszaros says.

Meszaros says the investment group’s interest in the 89%-leased complex is its location directly across the street from Lockheed-Martin Corp.’s assembly plant as well as its promise of “good investment product with high-yield income potential.” The one-, two- and three-bedroom units average 823 sf; rents go from $580 to $780 per month.

“They came to us with a strong early offer in the first week of marketing,” Cortez tells The bid abruptly closed the sales campaign for the 41-year-old complex on 10.4 acres, with the deal closing 45 days later. The seller was LNR Property Corp., formerly Lennar Partners Inc., of Miami Beach, FL.

In Pantego, Wehner Management Co. of Los Angeles pocketed the deed to a 95%-leased complex, Shady Valley Square Apartments, which sits close to a community golf course. Eight investors were in the chase for the class C prize, says Jay Gunn of Hendricks & Partners in Dallas. He and Hendricks’ associate partner Tom Burns represented the seller, Sherron & Associates of Seattle, which had owned it nearly one decade.

Built in 1969 on 6.8 acres, Shady Valley Square is 80% one- and two-bedroom units, with the overall average at 1,018 sf. The first-time buyer in Dallas/Fort Worth is starting out with rents ranging from $400 to $616 per month, with the landlord paying water and sewer, a residents’ perk that could soon change in order to gain upside.

“They think there’s immediate upside in the rents with some of the minimum upgrades that they’re going to do and more focused management,” Gunn says, adding that Devonshire Real Estate & Asset Management Group of Dallas has been hired for the day-to-day work. He estimates a 5% immediate rent growth is possible.

Gunn says the new buyer in town was deploying gain from a 1031 exchange of a multifamily property in Los Angeles. Ryan Wehner, a broker in Los Angeles, led the buy side’s negotiations.

With interest in Arlington running so high, class B properties in the city are fetching roughly $35,000 per unit while class C’s are ranging from $25,000 to $30,000 per door. None of the brokers for the trio of properties, carrying assessments of $1.1 million to $2.3 million, would provide sale prices due to the wary eye of Tarrant County’s appraisal district, which like Dallas County, is on the lookout for any published price to help ascertain property assessments in the non-disclosure state. But, the dealmakers did say that all three sales fell within the market’s comparable trades.

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