PHOENIX—Colliers International in Greater Phoenix recently completed the sale of Promenade at Desert Sky, a 300-unit, class B apartment complex in Phoenix, for $11.85 million, or $39,500 per unit. Desert Sky Estates, LLC, of Woodmere, NY, purchased the property, at 6233 W. Thomas Road, from WT Promenade LLC of Englewood, CO.
Bill Hahn, Jeffrey Sherman, and Trevor Koskovich, senior vice presidents with Colliers International's HSK multifamily southwest team, represented both buyer and seller.
Sherman tells GlobeSt.com the Maryvale submarket, in which the apartments are located, has seen some tough times. “It was hard hit during the downturn,” he says, “with lower rents and higher vacancies—much of it due to SB1070. But the past 12 months we have seen a lot of success in this submarket with lower vacancies and pushing rents.”
Built in 1987, Promenade at Desert Sky features the highest quality architecture and design compared to Class B competitors in the Phoenix multifamily market. The apartment community consists of 216,140 square-feet, in 17 two-story buildings, situated on 11.4 acres. A wide frontage area faces an active thoroughfare at the entry.
Unit mix is 68 one bedroom/one bath, at 525 square-feet, and 124 one bedroom/one bath, at 690 square-feet. There are 68 two bedroom/one bath, 860 square-feet, and 40 two bedroom/two bath, 910 square-feet, apartments.
According to Sherman, the buyer acquired a traditional loan through New York Community Bank to finance the deal. The buyer owns two other properties in the area and will be self-managing Promenade at Desert Sky. The property had a 13% vacancy rate at close of escrow.
“Promenade at Desert Sky is one of the more physically attractive multifamily assets in the immediate area. The buyer will be able to leverage this attribute along with light physical improvements to derive above average performance in terms of rents and occupancies moving forward,” says Sherman. “The buyer will make some value-add upgrades to the interior, like hard surface flooring. There will also be some improvements in the common areas as well as in the landscaping.
“This deal really is an indication of where we are in the market today.”
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