(Read more on the multifamily market.)
LEESBURG, VA-Bellemeade Farms, a 316-unit garden apartment community here, has traded for $47.5 million or $150,316 per unit.
The seller is an entity controlled by the Reston-based Comstock Homebuilding Cos. The publicly traded firm acquired Bellemeade Farms, located on Gateway Drive SE, in 2005 to be converted to a condominium community. Those plans had only partially came to fruition when the firm decided to stop the marketing process in February and reposition it as a fractured condo conversion opportunity, according to Coldwell Banker Commercial Ideal Realty Group team leader Dean Sigmon. Eventually the property was sold to an entity controlled by the Chicago-based Waterton Associates. The deal closed at the end of last week, according to Sigmon, who represented both parties in the transaction.
Coldwell Banker Commercial Ideal Realty had also brokered the sale of Bellemeade when Comstock acquired it from Fairfield Residential in California as a condo conversion. Comstock then upgraded many of the units, 58 of which were subsequently sold as condos. The buyer is transitioning Bellemeade back to a conventional multifamily property after working with Comstock to buy back the condos, Sigmon explains.
This conversion reversion is, of course, indicative of the slowdown in the condo markets. Comstock is no stranger to the ebb and flow of this cycle: last year it sold a class B, 258-unit garden apartment community in Reston for $40 million to Bethesda, MD-based Ross Development and Investment.
Comstock originally acquired the property in early 2005 from Rreef with the intention of converting it into a condo property, Sigmon, who represented both parties told GlobeSt.com at the time.
At that point, in November, he had found only one other comparable project--Chicago-based Equity Residential acquired a property in Alexandria from Monument Realty that had originally been slated for condo conversion.
Since then the number of conversion reversions in the Greater DC area have stepped up, at least from Sigmon's perspective. "Bellemeade is our third condo reversion. We have completed a second that we cannot announce due to client confidentiality. We are now currently working on a fourth and have a fifth in the pipeline as well."
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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.
