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REA
September 26, 2018  

Invesco Eyes 50% Stake in NY Rental Portfolio

Invesco Real Estate is in talks to buy a 50% interest in five Manhattan apartment properties valued at roughly $1.2 billion.

The 1,928-unit portfolio is solely owned by AvalonBay Communities of Arlington, Va. The REIT shopped the 50% stakes via Cushman & Wakefield. Dallas-based Invesco emerged as the lead bidder and has begun negotiating the purchase agreement.

The portfolio encompasses a pair of two-building complexes and three single buildings. Two of the single buildings are subject to ground leases.

The portfolio’s “whisper” price of $1.2 billion valued the units at an average of $622,000. The apartments at four properties range from studios to two bedrooms, with the remaining building also having some three-bedroom units.

In its April earnings call, AvalonBay chief operating officer Sean Breslin said that the New York market is one of the nation’s “weakest performers” and that effective rent growth had been “flat to modestly positive.”

The portfolio’s properties are:

The 627-unit Avalon Clinton North and South, at 515 West 52nd Street, between 10th and 11th Avenues. Completed: 2007-2008. Rents start at $2,900.

The leasehold interest in the 405-unit AVA High Line, at 525 West 28th Street, between 10th and 11th Avenues. Completed: 2015. Rents start at $3,400.

The leasehold interest in the 305-unit Avalon West Chelsea, at 282 11th Avenue, between West 28th and West 29th Streets. Completed: 2015. Rents start at $3,400.

The 296-unit Avalon Bowery Place 1&2, at 11 East First Street, between the Bowery and Second Avenue. Completed: 2006-2007. Rents start at $3,900.

The 295-unit Avalon Morningside Park, at One Morningside Drive, near West 110th Street. Completed: 2009. Rents start at $3,700.