Quadrangle Village in Tempe Sold for $41.875m

By: Paul Dionne | Vizzda

Greg Merage of MIG Capital has acquired the 510-unit Quadrangle Village apartments in Tempe for $41.875m or $82,108 per door. The property, located east of the southeast corner of University Drive and Rural Road, is comprised of sixteen 3-story buildings totaling 375,660 ft² built 1987 on 14.18 acres. The property is 94% occupied and has the following unit mix:

No. of Units	Bedrooms	Bathrooms	Square Feet	Market Rent*
18	0	1	493	$642
246	1	1	643	$795
10	2	1	848	$909
236	2	2	848	$1,045

MIG Capital assumed $27.247m in existing agency debt with Freddie Mac, originally loaned on March 24^th, 2009 and maturing April 1^st, 2020, with a stipulated balance at time of sale of $25,682,244. The seller, Stanley Fimberg of FSC Realty, acquired the property in March of 2006 for $43.75m or $85,784 per door. FSC paid $6.04m in cash at that time and secured $37.71m in new debt with GMAC Commercial mortgage, comprised of a $35.19m “A” note and a $2.52m “B” note. The “A” note was refinanced on March 24^th, 2009 with the $27.247m debt being assumed by MIG Capital with sale.

Vizzda has four large multifamily sales comparables in the Tempe sub-market within the last six months, all of which priced significantly higher than the Quadrangles Village due in part to the comps being considerably newer builds. The largest of these comps in an absolute sense is the Late February 2014 sale of the Alta Ravenwood for $45.45m, while Block 1949 commanded the highest per door price of $195,555. CBRE reports net operating income for the property as $3,085,832 for an implied capitalization rate of 7.36%.  

*Per CBRE Broker Flyer, found here.

The Sonora Canyon Apartments sell for $30m

 Vizzda – July 16, 2013 – The Sonora Canyon Apartments were sold Monday to Lone Star Funds for $30.0m or $ 77,320 per door. The apartments had been owned by Orix Real Estate Capital. Scott Cronister chief operating officer of Orix and Marc Lipshy vice president of Lone Star closed the deal. Lone Star financed the deal with a $494,262,293 acquisition loan funded by Citibank & Royal Bank of Canada maturing July 8, 2015.

The Sonora Canyon Apartments are located south of the southeast corner of Gilbert Road and University Drive  at 265 N Gilbert Rd in Mesa.  This 388-unit 2-story apartment complex totals 33 buildings and was built in 1984 on 15.80 acres zoned RM-4. Sonora Canyon features a mix of eight different unit styles with 224 one-bedroom and 164 two-bedroom apartments totaling 312,880 rentable square feet. The apartments are individually metered for electricity.

 Mercury Investments of Duluth previously acquired these apartments from a Capital Associates joint venture on August 21, 2000 for $16.875m or $43,492 per door with $14.428m debt with First Union Bank. Mercury Investments sold to Security Properties of Seattle on September 21, 2005 for $22.15m or $57,087 per door with $22.15m debt with GMAC Commercial Mortgage. Security Properties sold to Orix Real Estate Capital on January 17, 2007 for $33.3m or $85,824 per door with no debt. 

Edward Moore
Director of Research

www.vizzda.com

Hamilton Zanze Purchases The Arbors Apartments

VIZZDA -- August 13th, 2012 – A 200 unit apartment complex at 805 W Brown Street in Tempe was sold by AIMCO Apartments to Hamilton Zanze & Co for $12.2M or $61.0K per door. The 41 building apartment complex was built between 1959 and 1967 on 6.74 acres. The apartments were previously acquired by Winthrop Financial Associates on August 16th, 1993, with no sale price recorded. The property was encumbered with $3,168,047 debt with Lexington Mortgage Company. Winthrop Financial Associates was purchased by AIMCO on October 31st, 1997 with a reported aggregate purchase price of $253.5M. 

At the time of purchase Winthrop listed assets comprised of 8,175 units in 35 apartment communities. The Arbors--then the Grovetree Apartments--were sold to AIMCO on November 5th, 1997 for $7.0M or $35.0K per door, Winthrop’s remaining debt was released at that time. AIMCO is reported to have paid $116.1M in cash and incurred $120.0M debt in 33 mortgages for 20 years at 7.0% in the acquisition. This includes a $3,916,538 loan with GMAC Commercial Mortgage on “The Arbors”, released December 7th, 2009. The principles on the deal were John Bezzant, executive vice president of AIMCO, and Mark Hamilton, chief executive officer of Hamilton Zanze & Co.

BY:
Ed Moore
Director of Research
emoore@vizzda.com