GVA Real Estate Group has acquired a 20-property multifamily portfolio from Cedar Grove Capital for $457.5 million, securing a $365 million in financing from Benefit Street Partners Realty Trust and Franklin Templeton in the process, Commercial Observer has learned.
Newmark Multifamily facilitated both the sale and financing — the latter comprising a $325 million acquisition loan and $40 million capital improvements loan. Newmark’s Dean Smith, John Heimburger and Jason Kon were the brokers on the sale, while Tip Strickland, Henry Stimler and Bill Weber secured the financing on behalf of the buyer.
“The Cedar Grove portfolio was a unique opportunity to acquire 19 properties in the Carolinas, which doubles our footprint in the region”, said Alan Stalcup of GVA in prepared remarks. “Additionally, the portfolio represents a fantastic value-add in both operational improvements and continued interior renovations. We’re excited to deliver the results our investors and residents expect from GVA.”
“We are very proud that we could help all parties involved in the transfer of this massive portfolio sale in an uncertain market,” said Stimler. “The team demonstrated our ability to deliver an ideal buyer in this off-market transaction and help new ownership secure competitive financing to execute their business plan and implement a capital improvements program across the portfolio.”
The 2,899-unit portfolio includes 16 assets in North Carolina, three in South Carolina and one in Oklahoma City.
“We are very proud to have delivered a successful execution for our investors and partners that serve as validation of our business model. We plan to redeploy the capital into new compelling MF investment opportunities,” said Aaron Gorin, founder of Cedar Grove Capital in prepared remarks.
According to research published by Newmark, despite brief periods where inflation outpaced total returns, over the long-term, multifamily has outperformed inflation by 6.8 percent annually on average. Even with recent historically high inflation levels over the trailing 12 months, total multifamily returns averaged 24.1 percent.
Emily Fu can be reached at email@example.com.