DALLAS, HOUSTON AND JACKSONVILLE, FLA. — Atlanta-based Cortland Partners, a multifamily acquisition, development and management firm, has purchased a $154 million, five-property multifamily portfolio totaling 1,435 units. The five Class A properties include Watervue in Dallas, Newport on the Lake and Harborview in Houston, and Mirador and Stovall in Jacksonville.
With the purchase, Cortland Partners has increased its portfolio by approximately 20 percent, bringing its total multifamily inventory to more than 10,000 units. Additionally, the purchase is the company’s first investment in Florida.
“Mirador and Stovall mark our initial expansion in to targeted markets in Florida, while the other acquisitions triple our presence in Texas, providing economies of scale,” says Steven DeFrancis, CEO of Cortland Partners.
Cortland financed the portfolio acquisition through an international syndicate of institutional and high net-worth equity investors from Israel, the Netherlands and the U.S. The institutional investors include Phoenix Insurance in Israel and Westplan Investors, a private equity group and partner to Cortland Partners.
Walker Dunlop provided debt capital through Freddie Mac for all five assets.
The Jacksonville metropolitan statistical area has been a popular destination for multifamily acquisitions. More than 10,000 units have been acquired in the past 12 months, twice as many as reported in the previous 12-month period, according to Marcus & Millichap Real Estate Investment Services.
Similarly, in Dallas, the pace of apartment sales steadily increased through the third quarter. According to Real Capital Analytics (RCA), sales volume in the Dallas apartment sector totaled $2.2 billion during the first three quarters of 2012 compared with $1.8 billion during the same period in 2011. That’s a 19 percent increase.
Institutional investors and REITs are projected to focus on core multifamily properties in Houston, according to Marcus & Millichap. Mid- to large-sized deals drove most of the acquisition activity in the Houston metro area. Through the first three quarters of 2012, apartment sales volume in greater Houston totaled $1.65 billion, up from $1.4 billion during the same period in 2011, according to RCA. The 18 percent increase is nearly identical to the growth seen in Dallas.
— John Nelson