BALTIMORE — Beech Street Capital has secured $371 million in Freddie Mac CME loans for the recapitalization of nine multifamily properties, located in the Baltimore metro area and one property located in the Washington, D.C., region. The communities include two- to four-story, garden-style and townhome-style apartment buildings.
Under the recapitalization, Kushner Cos. acquired approximately 25 percent in the ownership group from a Rockpoint Group Partnership, which retained the remaining interest. Westminster Management, an affiliate of Kushner Cos., will manage the properties.
According to commercial real estate services firm Transwestern, the average apartment effective rent in Baltimore in the second quarter grew by 5.7 percent on a year-over-year basis. Meanwhile, the Class A vacancy in the second quarter registered 3.2 percent, down 130 basis points from this time last year.
Meridian Capital Group originated the 10-year, fixed-rate loans with partial interest-only payments. Beech Street financed the transaction as part of its correspondent relationship with Meridian. The funds will pay off the remaining existing debt and preferred equity on the 5,517-unit portfolio, as well as fund immediate capital expenditure reserves and budgets.
New York City-based Kushner Cos. has owned more than 35,000 apartments in the company’s 30-year history. In 2011, Kushner Cos. acquired 6,000 multifamily units.
— Savannah Duncan