The 94.2%-leased Hunters Point, situated on 12 acres at 1805 NE Green Oaks Blvd., is assessed at $11.1 million by Tarrant County's appraisal district. Alex Brown, the Baltimore-based equity partner, and Price picked up the asset from VR Hunters Point LP of Webster, TX, which had Apartment Realty Advisors in Dallas at the head of the marketing campaign.
"This asset was very well priced," Thomas Burton, Alex Brown's CFO, tells GlobeSt.com, adding the final cost was more akin to deals 12 to 18 months ago. And, he predicts the future will hold more of the same whether it's due to distressed conditions or motivated sellers.
Hunters Point is a class B plus in a class A location, according to Burton and Alex Brown's acquisitions officer Craig Dranbauer, who sourced the deal. Burton says the purchase was underwritten for a five- to seven-year hold.
Dranbauer adds the asset's quality, location, pricing and opportunity to add value through an interior rehabilitation are what drew him to the deal. The seller had completed work on 34 units, getting a $150 premium in the monthly rent for each one in comparison to the asset's other apartments, according to the JV. The new owners plan to upgrade the balance of the units during the next two years.
The 15-building complex has 200 one-bedroom units, ranging from 664 sf to 769 sf, and 72 two-bedroom apartments with 872 sf to 990 sf. The average works out to 766 sf, with average monthly rents of $758. Under the JV terms, Dallas-based Price Realty, led by Michael Ochstein, will manage the 24-year-old gated complex.
In the release, Ochstein points to North Arlington's rental rate growth and single-digit vacancy as additional upside for the new owners. "We anticipate these trends will continue given the limited activity in the pipeline," he says.
Alex Brown Realty tapped its ABR Chesapeake Fund III, earmarked for value-add deals, for the equity. John Brownlee of Holliday Fenoglio Fowler LP in Dallas arranged the debt. The JV assumed a fixed-rate, interest-only loan that matures in May 2015.
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