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January 17, 2018  

Big Southeast Apartment Package Hits Market

In what figures to be one of the year’s largest multi-family offerings, AVR Realty and partners are marketing 13 properties in the Southeast that could trade for as much as $850 million.

The properties, a mix of garden-style complexes and urban high-rises, encompass 3,760 units in the Carolinas, Georgia and Florida.

The weighted average vintage is only three years. But some were constructed as long ago as 2006 and have value-added potential. At the other end of the scale, one was just completed and is still in its initial lease-up phase. The overall occupancy rate is roughly 95%.

Cushman & Wakefield is shopping the portfolio, whose estimated value works out to $226,000/unit. Investors can bid on individual properties or any combination.

AVR, a Yonkers, N.Y., investment shop led by Allan Rose, acquired 10 of the 13 properties from their developers. It built the others with three joint-venture partners: Altman Cos. of Boca Raton, Fla., Davis Property of Greenville, S.C., and Middle Street Partners of Charleston, S.C. (see table at right).

The properties are concentrated in secondary markets with strong economies and wage/job growth. Over the past few years, yield-hungry institutional buyers have increasingly focused on such areas after being priced out of major markets.

There are four properties in Atlanta, four in Florida (two in Fort Lauderdale and one each in Orlando and Tampa), three in North Carolina (two in Charlotte, one in Raleigh) and two in South Carolina (one each in Charleston and Columbia).

Last year, only three multi-family portfolios sold for more than $800 million, and two of them involved student housing. The lone trade of traditional apartments was the $1.8 billion purchase of a 9,677-unit portfolio by Harbor Group International of Norfolk, Va., from Lone Star Funds of Dallas.