(Mark Your Calendars: RealShare Apartments 2011, October 20 in Los Angeles, and don't forget RealShare DISTRESSED ASSETS, October 4-5 in Grapevine, TX).
CHESTER, PA-A multifamily portfolio here traded out of receivership to a private entity based in New York for the bargain price of $8.5 million. The purchase grabbed three properties consisting of a 386-unit total. Joseph Brecher, executive vice president, and sales associate Eli Kessler of Gebroe-Hammer Associates arranged the sale.
The receiver of the property was Altman Management and the purchase was made with financing from New York Community Bank. The portfolio had sat for about a year in receivership at the time of purchase, Brecher tells GlobeSt.com. “It was a distressed property and the buyer knew exactly what he had to build. He knew what he had to do to bring it up. Three different properties, each one with its own set of challenges.”
The properties are St. James Gardens, which is a nine-building complex at 314 east 224th St. here. The two-story garden apartment buildings consists of 228 units on a cul-de-sac divided into 136 single-bedroom and 80 two-bedroom units. The property will receive new floors, kitchens, baths, cabinets and heating controls. The Renshaw Terrace Apartments at 1300 Renshaw Rd. is 78 units throughout three-garden apartment buildings. The units are broken down into 62 single-bedroom and 14 two-bdroom apartments. The common area will receive a revamp, as well as new kitchens, baths and roofs throughout. The Willow Gardens at 1101 Dorian Dr. has seven buildings with 80 units in this two-story complex.
The occupancy at the time of closing was roughly 60%, Brecher estimates. “In Willow, the area was a pretty tough area and…there was nobody paying rent at the property and it needed a lot of work,” he explained. “Whereas Renshaw was in somewhat of a better area, so that was a different type of animal, how do you spruce it up? And St. James, the largest one, was in fairly decent condition, but was at half-vacancy.
Brecher points out that the deal became a bit complicated, not only through the distressed portion of the sale. In the middle of the deal, 36 units were removed from the portfolio. “There were initially 36 additional units that were going to be part of the sale. And they were taken out in the middle because somebody else bought them with a loan pool.” The units were part of a three-building horseshoe-shaped property that was part of St. James. The complex could operate separately and was siphoned off.
The seller was represented legally by Richard A. O'Halloran, esq. of West Conshohocken, PA-based Burns White LLC and Yaron Kornblum, esq. of Uniondale, NY-based Rivkin Radler LLP repped the buyer.
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