The deal was a textbook case in the distressed property world--an owner facing possible foreclosure, properties underleased compared to others in their market and the finance mechanisms in place to make the deal happen quickly. "It reminds me of the good old days," says Frank Patafio, CFO of Praedium. "We're an opportunistic firm looking for arbitrage opportunities in the market, and this was a classic case."

Praedium focuses on adding value to underperforming, undervalued assets throughout North America, owning properties in all asset categories. Office buildings comprise approximately 55% of the holdings, with multifamily and mixed-use each at about 14%. This latest transaction increases the multifamily portfolio by 12%.

The Florida and Georgia properties are class C assets built in the mid-1980s and late 1970s. They are about 75% occupied in markets that are generally 90% rented. Patafio says the properties should be stabilized in 18 to 24 months through capital improvements and an aggressive leasing effort, and he expects Praedium to hold them for three years. The former owner will continue to manage the portfolio.