(Read more on the multifamily market.)
ELKINS PARK, PA-Lynnewood Gardens, one of the nation's largest multifamily complexes, has sold for approximately $135 million, or close to $75,000 a unit in an off-market transaction. The seller is a Brooklyn, NY-based private investment partnership, and the buyer is an unidentified New York City-based real estate partnership with significant multifamily and office holdings in the tri-state area.
Joseph Brecher, SVP, and Robert Ploshnick, managing director of Livingston, NJ-based Gebroe-Hammer Associates, spearheaded the deal and represented both the buyer and seller in the transaction. The deal closed in less than 30 days from the time the contract was executed.
The 1,798-unit, 31-building property is located on 122 landscaped acres along Montgomery County's border with Philadelphia. It consists of 1,696 one- and two-bedroom units, plus 102 three-bedroom townhouses. Brecher tells GlobeSt.com the complex was a Section 608 housing project, designed to house veterans returning from World War II, and developed by Bensalem-based Orleans homebuilders in the late 1940s and early 1950s.
At the time of this sale, Brecher says occupancy was above 85%. "In a large complex like this, occupancy fluctuates. This area is a 95% occupied apartment market," he adds, calling that a contributor to the buyer's upside potential. "With upgrades and a capital infusion, the buyer believes occupancy here will lift to 95% and also lead to rental appreciation." He says the new owner plans to invest at least $5 million, "which will include upgrades to units, landscaping, and, possibly down the road, maybe an added fitness, lifestyle center."
Current rent rates for a one-bedroom unit range from about $700 to $800 a month, from $800 to $900 a month for a two-bedroom unit, and the average for a townhouse is $1,300 a month, according to Brecher. The location, 25 minutes from Center City Philadelphia, is in the Cheltenham school district, which Kenneth Uranowitz, also a managing director of Gebroe-Hammer, calls "blue ribbon." Amenities at the complex include an Olympic-size pool and on-site shuttle service to the Elkin Park regional rail station.
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