Two Multifamily Assets Trade for $96M, a Premium $185K Per Unit

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COCONUT CREEK, FL-In unrelated transactions, two multifamily rental properties, Preserve at Coconut Creek and Florida Club at Coconut Creek, sell to condo converters for just over $50 million and close to $45.9 million, respectively. In each case, the per-unit price is approximately $185,000.

“They are comparable products, and both buyers paid a premium for condo conversion,” Richard Donnellan, a principal of Apartment Realty Advisors’ Florida office in Boca Raton, tells GlobeSt.com. ARA negotiated both transactions.

Hawthorne, NY-based GDC Properties Inc. sold the 272-unit Preserve garden-style complex to Preserve LLC, which Donnellan says is an affiliate of Lennar Homes. He and Sean Williams of ARA represented GDC and secured the buyer. The asset encompasses 13 two- and three-story buildings containing an aggregate of 92 one-bedroom units, 132 two-bedroom units and 48 three-bedroom units.

William Ingraham, GDC’s president, says his company “is committed to the income-property business. Some of our apartments are being valued as condominium conversions today rather than as income property, and we’re taking this opportunity to re-deploy our capital into more productive investments.” GDC will focus on retail development and acquisition, he adds.

Like Preserve, Florida Club was constructed in 2000. The seller, Chicago-based Equity Residential Properties, “had planned to convert the complex to condominiums,” Donnellan says, “but demand from other condo converters was so strong, they decided to sell.” The buyer is Boca Raton-based EB Developers, which is an active developer of residential communities and condo conversions throughout Florida. Donnellan and ARA VP Avery Klann negotiated this transaction.

The Club has eight two- and three-story buildings with an aggregate of 248 one-, two- and three-bedroom units, plus a clubhouse and six detached garage buildings. Both of these assets are fully occupied, according to Donnellan. He says “approximately 11,396 rental units in properties with 150 units or more have sold so far this year in Broward County, which is an increase of 69% over the same period a year ago. Affordable housing in Broward will continue to be a major issue with median home values approaching $400,000,” he says. “This is why we’re seeing such strong demand for moderately priced condominiums.”