(To read more on the multifamily market, click here.)
BALTIMORE-A Silver Spring-based individual investor has sold three multifamily properties that were acquired in a 12-asset, 402-unit portfolio trade that closed in September 2006, as GlobeSt.com reported. The buyer of these assets, also an individual investor in Silver Spring, paid $3.5 million or $55,000 per unit for the portfolio.
The class C properties, located in the Northwest Baltimore City submarket, are 5512 Haddon Ave., which consists of 23 units; 3701 Liberty Heights Ave., with 16 units and 5007-5009 Norwood Ave.; which has 24 units. There was fire damage in 5512 Haddon Ave., but the property was successfully rehabbed prior to closing.
The acquisition price made sense for both buyer and seller, Cullen O'Grady, a broker with Marcus & Millichap Real Estate Investment Brokerage Co. in Washington, DC, tells GlobeSt.com. "Sales in this area range from a low of $45,000 to as high as $55,000. When we resold that portion of the portfolio, $55,000 was the highest comparable sale we could find."
When these properties first traded in two separate closings--July and September--the acquisition price was $15 million, or $37,313 per unit. Some of the assets in the portfolio needed substantial renovation, which was reflected in the lower-than-average unit price.
O'Grady, with partners Rick Struse, Joe Orji, Brian Lim and Harold Sims, represented both parties.
The buyer plans to make capital improvements, raise rents and reposition the properties, which have an occupancy rate in the low 90s, O'Grady says. Rents currently range from $450 to $650 per unit. The apartments are a mix of one-, two- and three-bedroom units.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
