By: Paul Dionne | Vizzda
In one of the largest transactions in terms of dollar value thus far this year, Chicago-based investment management firm, Heitman, sold one of the largest apartment complexes in the valley—the 676-unit Lakeview at Superstition Springs for $66.6m. The buyer was San Diego-based multifamily developer Fairfield Residential who paid $19.2m in cash for the property and secured an additional $47.4m in funding from CBRE Multifamily Capital, assigned to Fannie Mae at origination. Fairfield owns or manages ten other properties in the greater Phoenix area. The $66.6m sales price equates to $98,520 per unit.
Lakeview at Superstition Springs’ 676 units are situated in eighty-nine residential buildings totaling 636,963 ft2 in addition to a leasing office and clubhouse that bring the total improved square footage above 640,000. The property was built in two phases: forty-two buildings totaling 287,135 ft2 built in 1996 and forty-nine buildings totaling 356,668 ft2 built in 1998. The gated complex sits on 42.72 acres net of the lakes complex that runs through the property and features four resort-style pools. The one bedroom floor plans range from 660 ft2 to 776 ft2, the two bedrooms range from 916 ft2 to a 1,314 ft2 split-level and three bedroom floor plans range from 1,181 ft2 to 1,214 ft2.
Heitman previously acquired Lakeview at Superstition Springs in March of 2006 for $59.4m or $87,869 per unit from Nearon Enterprises. At the time of sale, Heitman assumed $38m in existing CMBS debt in care of Lasalle Bank and secured additional funding in two notes with Deutsche Bank Berkshire Mortgage of $8.957m and $29.543m, maturing April 1st, 2011 and both of which were assigned to Fannie Mae at origination. Those debts were released in May of 2012 and replaced with $36m in new debt with CW Capital. Ignoring financing and carry costs and operational proceeds, Heitman earned a 12.1% absolute rate of return and a 184.6% cash-on-cash return.
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