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AUSTIN, TX-Three class A-plus complexes in Chapter 11 have arrived on the sales block, complete with modifiable, assumable debt. The 1,417 units, bought in 2007 for between $185 million and $190 million by CNC Investments are now in foreclosure and being marketed without a price.

“These assets are over-the-top nice, and I don’t mean that from a broker B.S point of view,” explains Patton Jones with Apartment Realty Advisors’ Austin office, who is leading the ARA marketing team in marketing the portfolio. For example, he continues, the 583-unit Monterone Round Rock at 7711 O’Connor Rd. in Round Rock, TX comes complete with a wine cellar and a theater room. The latter has a 120-inch screen and surround sound.

The less than 10-year-old portfolio is stable at 92% occupancy, though Jones acknowledges the suburban concessions overall are higher than what he’d like to see. The issue isn’t the assets, Jones tells GlobeSt.com, as much as a soft market. With the economy, he acknowledges, renters are more interested in saving bucks through renting smaller spaces and fewer amenities. The Monterone portfolio’s average unit size is around 1,200 square feet, with rent averaging at around $1 per square foot.

However, with the amenities attached to Monterone Round Rock and sister assets 502-unit Monterone Steiner Ranch at 4500 Steiner Ranch Blvd. and 332-unit Monterone Canyon Creek at 9009 Ranch Rd. 620 N., Jones says when the market comes roaring back, so will demand for the class A assets. Furthermore, he continues, the Monterone collection will benefit from a pipeline that is quickly drying up.

Thanks to lack of financing for any kind of construction, let alone multifamily product, “as of 2012, there will be few deliveries in and around the city of Austin,” Jones remarks.

The portfolio is being brought to market in its entirety, with no cherry-picking allowed. The loan attached to the portfolio has a 5.77% interest rate, interest only for another seven years. The final call for offers is Oct. 29.

Jones says he’ll be interested to see what types of players come to the table for this particular portfolio, and predicts offers coming from public and private REITs as well as private wealthy trusts and individuals. “These are the new breed of investor, the private, wealthy investor that is a cycle buyer,” Jones comments. “They haven’t been buying during the past eight to 10 years, but now with the market so soft, they’re back and looking at multifamily opportunities.”

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