MIAMI, FL-Flagler Terrace Apartments, a 22-unit apartment community in Miami, has sold for $1.45 million, or $65,000 a unit. The property attracted 12 potential buyers and received five offers in the two weeks it was on the market.
Marcus & Millichap Real Estate Investment Services’ Senior Associate Ronnie Issenberg and Associate Scott Sandelin of the Miami office represented the seller, a private investor from Aventura. Associate Arthur Porosoff, also of the Miami office, secured the buyer of the property, a private investor from Doral.
“We had an overwhelming response from the investor community,” Sandelin tells GlobeSt.com. “We sold the property for an incredible 98.3% of list price at a cap rate of 7.13, which is pretty low by today’s standards.”
The property, located in the heart of Miami's Little Havana neighborhood, spans two adjacent buildings fronting two major east/west retail corridors. Specifically, the buildings are located at 1227 Southwest 1st Street & 1250 Southwest Flagler Street. The property is 100% occupied.
“Interest rates at historic lows in terms of commercial properties, and multifamily has the best interest rates,” Sandelin says. “That fueled this purchase. We are also seeing some other properties being sold at very aggressive cap rates. There is a pent up demand in Little Havana’s multifamily sector.”
Not all Little Havana projects have been a success. In June, REDC sold 24 condo units at auction in Little Havana’s Altos de Miami for $2.91 million. Last August, Mercantil Commercebank filed a $2.8 million foreclosure suit against AGM Properties III Corp, the owner of a 43-unit apartment building in Little Havana. However, older multifamily properties in Little Havana have consistently performed well.
“We’ve closed more than 20 small multifamily deals this year,” Lloyd Berger, president of Ft. Lauderdale-based Berger Commercial Realty, tells GlobeSt.com. “There is so much money chasing these multifamily deals with 30 units and under. There is a tremendous appetite.”
Brad Shepherd, a senior manager at Berger Commercial, tells GlobeSt.com that Little Havana consistently has stronger occupancy than the surrounding markets. “There are tenants that have been in some of those buildings for 15 years,” he says. “In a 15-unit building it’s not uncommon to have four of the units occupied by relatives. So it’s a strong rental market.”
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