(To read more on the multifamily market, click here.)

HOUSTON-Partnering for the first time, Preferred Communities and Cypress Real Estate Advisors have acquired Gates at Hermann Park, a 320-unit, class A complex in the Texas Medical Center. An industry expert familiar with the property says the partners paid roughly $110,000 per unit or $35.2 million for the complex, which translates into a 5% cap rate.

The locally based Preferred Communities and Cypress Real Estate from Austin outmaneuvered 20 would-be-buyers to claim the 12-building complex at 6301 Almeda Rd. from New York City-based ING Clarion, according to David Mitchell, an investment broker with Apartment Realty Advisors' Houston team. He says the majority of potential buyers were private equity funds although a handful of REITs and pension funds threw their hats into the ring.

Mitchell tells GlobeSt.com that the new owners plan to continue to operate the 92%-leased Gates at Hermann Park as a rental community despite the proliferation of condominium conversions in the Medical Center. "At the end of the day, it was just a good rental deal," he says. "With the lack of available land and all the jobs, the new owners feel that demand for apartments is going to increase. The Medical Center is the most sought after area in Houston for investors."