Berkadia Secures $44M Loan for Purchase of Westchester Apartments Near FIU
Advenir bought the apartment complex across from campus for nearly $60 million.
September 04, 2018 at 12:15 PM
4 minute read
Berkadia secured a $44.32 million loan for the purchase of a Westchester apartment complex that's slated for a facelift under the new ownership.
Advenir Inc., an Aventura-based real estate investment company that focuses on multifamily properties, bought the apartment community at 10491 SW 14th Terrace for $59.75 million from the Rilea Group, a Miami-based real estate development and management company.
Advenir at University Park is a 302-unit, garden-style complex east of Southwest 107th Avenue from Florida International University's Modesto A. Maidique campus.
Berkadia senior managing director and Florida co-leader Charles Foschini, managing director Christopher Apone and senior analyst Lourdes Carranza-Alvarez in Miami represented Advenir in obtaining the acquisition financing in a deal that closed Aug. 17.
The loan covered a 74 percent of the purchase price — at least in part a reflection of the asset's advantageous location.
It's across from FIU and a short drive from the Dolphin Expressway and Florida's Turnpike.
“FIU is one of the fastest growing and best state schools in the country. In addition to growing its student base, that has many other benefits to the school in terms of faculty employment, adjunct employment (and) business generation,” Foschini said.
FIU has about 54,000 students and is among the top 10 biggest universities in the U.S., according to its website.
The Freddie Mac loan is an 11-year, fixed-rate loan with the first six years being interest only.
Foschini declined to disclose the interest rate, only saying it's aggressive.
“Working together with Freddie Mac we were able to get a fixed-rate loan on an exceptional asset where they believed that the new operator could increase occupancy quickly and improve the value of the asset through selective improvements to the units and the landscape of the property,” Foschini said.
The purchase price breaks down to $197,848 per unit, while the loan breaks down to $146,755 per unit.
This was a value-add investment for Advenir, meaning it bought the 1993 apartment complex with renovations in mind.
The revamp will include a bigger clubhouse as well as improvements to the countertops, floors and kitchens, providing a “like-new experience” in the units, according to Foschini.
“Advenir has a long history of demonstrating value-add by upgrading the amenities for the enjoyment of the residents and at the same time providing thoughtful improvements to the interiors, which will provide a very modern living experience to an asset that was developed almost 30 years ago,” he said.
This deal came with some hurdles. For one, occupancy at the time of sale stood at 88 percent, according to a news release on the loan deal. Foschini said that's less than the 90 percent occupancy normally acceptable for a fixed-rate agency loan.
Still, he noted Berkadia's previous relationship with Freddie Mac and Advenir's track record as “an extremely strong operator of commercial real estate” allowed for the competitive loan.
Berkadia is a joint venture of Berkshire Hathaway and Leucadia National Corp., which formed in 2009 to focus on multifamily and other commercial real estate clients.
Advenir at University Park, previously called Vista Verde, has 10 two- and three-story buildings. Studios rent for $1,233 and $1,226; one bedrooms for $1,413; and two bedrooms for $1,596 and $1,615, according to its website.
Foschini said he's uncertain whether rents will rise with the planned renovations.
“The new and improved Vista Verde will cater to the growing demographic that's benefiting from either FIU interaction or FIU employment,” he said.
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