(To read more on the multifamily market, click here.)
MESA, AZ-Despite a HUD loan with a fixed-rate interest of more than 8%, the 256-unit Village at Lindsay Park has been sold to a Camarillo, CA investment group for $16.67 million.
"Because of that loan, it flat out took a long time to sell," explains Chuck LaBenz, associate partner with the Phoenix office of Hendricks & Partners. LaBenz, who negotiated the transaction on behalf of the seller, Carefree-based Four D's LLC, adds that the ask was $17.2 million during the listing's four-month run on the market. The buyer, Seal Beach Associates LLC, got a 96%-leased complex, built in 1997 at 1441 S. Lindsay Rd.
The complex has 88 one-bedroom units, 136 two-bedroom apartments and 32 three-bedroom designs, averaging about 932 sf. Monthly rents average $753.
Though the property was a fairly new one, in good condition and with a strong occupancy, LaBenz tells GlobeSt.com that the 8.18 % HUD loan, along with a half-point of insurance and a three-year lock period remaining, scared potential buyers off--and was one reason why Four D's wanted to sell the property. "Everyone loved the property," he says. "But the problem was the financing and it wasn't going to go away for awhile."
The buyer, on the other hand was looking at the real estate investment potential and price per sf, which, according to LaBenz, seemed to be in line with Seal Beach's goals. "It was pretty much a market deal," he says. "The seller wanted to sell, the buyer wanted to buy. Both had different goals for their investments and they made a deal."
LaBenz adds the seller, who owns additional multifamily properties in the Phoenix area, is examining other properties. But for now, he says nothing else is under contract.
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