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Management Firm Pays $61M for Fractured Condo

ROCKVILLE, MD-The owner intends to stabilize the property and then decide what its long term plans are for it once the market settles.

By Erika Morphy | Updated on June 10, 2008

[IMGCAP(1)]ROCKVILLE, MD-The Royalton at King Farm, a 317-unit housing community–of which 275 are apartments–has traded for $61.2 million, or $223,000 per unit. Bernstein Management Corp., which is based in the DC area, acquired the 275 apartments from iStar Financial in New York. A team from Coldwell Banker Commercial Ideal Realty Group brokered the transaction, led by Craig London.

[IMGCAP(2)]An erstwhile condo conversion project, the Royalton at King Farm has traveled a path familiar to owners of multifamily properties that tried to convert them to condos–just as the condo market began to crash. Located at Route 355 and King Farm Blvd. near the Shady Grove metro station, the property was originally purchased as a 317-unit multifamily in 2006 by Monaco Development in Chicago, which then proceeded to convert the property into condos. That process stalled as the condo market began to falter shortly after the property’s purchase; two years later only 42 of the 317 units have sold as condos. The property transferred to iStar via foreclosure in Feb. 2008.

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