Harbor Group Sells Virginia Beach Apartment for $43M

VIRGINIA BEACH, VA—Newmark Knight Frank has arranged a $33 million debt financing loan for the oceanfront multifamily community, The Mayflower, here. The Lynd Acquisitions Group (LAG) purchased the property from Harbor Group for $43 million.

Executive managing director Bill Weber and managing director Henry Stimler of NKF’s Multifamily Capital Markets brought the buyer to the opportunity and worked with lender, Hunt Mortgage Group, on a $33 million loan.

“Mayflower Apartments are the only high-rise property right off the beach, and the new owners saw the potential in committing to a solid capital improvements plan for the asset,” Stimler says. “To make that a reality, we worked with Hunt Mortgage Group through Marc Suarez, who provided LAG the financing they needed to realize the full potential of this one of a kind apartment building.”

Mayflower is a 16-story, 266-unit property located at 34th Street and Atlantic Avenue and is a highly coveted address being the only high-rise rental building within a block of the Atlantic Ocean. The multifamily property also has 3,140 square feet of ground-floor commercial space, a separate parcel with 11,915 square feet of free-standing retail and on-site and off-site parking. The Mayflower has studio, and one-and-two-bedroom units, and a penthouse floor with commanding views of the coastline.

“This is a crown jewel in Virginia Beach; there is nothing else like it,” says A. David Lynd, CEO of LAG.

LAG plans on spending more than $4 million on capital improvements to both common areas and individual units. The group will invest more than $13,000 per unit to renovate interiors. They will also perform upgrades to the common areas to include the addition of Amazon package lockers, surfboard lockers, and an updated fitness center. Upgrades will begin soon to vacant units.

The Mayflower was built in 1950, renovated in 2007, and again in 2010. The Harbor Group bought it in 2012. Stimler says Harbor, located in Norfolk, typically holds properties for three to four years, but had a connection to the property because it was nearby and held it longer. They enlisted Newmark Knight Frank to sell it a few months ago.

“There is a lot of value to be unlocked by upgrading the units there,” Stimler says. “They will be doing a full-scope renovation. They will be gutting and modernizing the units, ripping out carpets, installing better lighting, cabinetry and flooring. There’s a lot to be done there.”

The Lynd Acquisitions Group previously successfully purchased and renovated a high-rise building in Chicago. That caught Stimler’s eye.

“We saw the deal and we figured out who was the right buyer for it,” Stimler says. “Our ability to match the right deal with the right buyer as well as the right debt gave us an edge. It’s a unique asset and will not fit on everyone’s profile.”