SAN DIEGO — Strata Equity Group has acquired a 24-property multifamily portfolio from an affiliate of New York City-based DRA Advisors LLC for $720 million.
The Southeast Residential Portfolio consists of 6,294 units located throughout 13 metropolitan areas in Georgia, North Carolina, Tennessee and South Carolina. The properties were built between 1985 and 2000, with an average year built of 1996.
Over the past three years, net rental income for the portfolio has increased 12.2 percent while averaging 95.3 percent occupancy.
Malcom McComb of CBRE negotiated the transaction on behalf of the seller. Bill Chiles and Robert LaChapelle of CBRE also secured $500 million in acquisition financing for Strata. The financing features a mixture of seven- and 10-year fixed- and floating-rate loans provided by Freddie Mac.
“We negotiated a portion of the portfolio under a newly created version of the Freddie Mac Revolving Credit Facility,” says Chiles. “This facility gives Strata Equity Group more financing flexibility for certain assets, as well as an attractive vehicle for new purchases with similar business plans.”
The names of only three properties in the portfolio were disclosed: Alta Mills, 1650 Anderson Mill Road, Austell, Ga.; Eagle Pointe Apartments, 8608 Eagle Pointe Drive, Knoxville, Tenn.; and Forest Ridge Apartments, 9706 Smoky Ridge Way, Knoxville, Tenn.
“We believe the long-term fundamentals of the apartment sector, particularly Class B product, remain healthy,” says Scott Wittman, director of investments at Strata. “Our investment in the Southeast Residential Portfolio reinforces that belief.”
Strata Equity Group is a San Diego-based developer, owner and operator of commercial real estate properties. DRA Advisors is an investment firm based in New York City.
— Katie Sloan