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In the largest multifamily transaction industry wide and nationally of 2011, Al Cissel and Scott Melnick arranged the sale of an eight-property multifamily portfolio in the Washington, D.C. Metro area. The 2,580-unit portfolio was sold for $460 million on behalf of RREEF, a developer and manager of multifamily apartment communities.
From the time RREEF and Bainbridge Companies acquired the portfolio in 2006, their objective was to sell it. However, the 2008 financial crisis and the $410 million of assumable debt due in one year's time were the main challenges in selling this asset. RREEF and Bainbridge engaged JLL to market the portfolio to potential buyers who would have interest in such a large transaction.
JLL had to research and locate potential investors and implement a marketing campaign that highlighted the benefits of investing in a diverse multifamily portfolio in the Washington, D.C Metro area, the nation’s most desirable multifamily market. The marketing campaign needed to highlight that the assets were well-positioned for significant rent growth due to the region’s strong economic performance and lack of new multifamily construction.
JLL targeted a small group of buyers capable of closing on a transaction of this size. A comprehensive offering memorandum was developed with a detailed description of the investment, overview of the region’s multifamily rental market and in-depth summaries of each property in the portfolio. These summaries included cash flow and rent comparables. To increase the communities’ rent premiums, JLL partnered with RREEF and Bainbridge to carry out $15 million in renovations to the properties between 2007 and 2010, including roof repairs, common area enhancements, and many in-unit improvements.
The transaction was not only the largest multifamily sale nationally in 2011, but the largest since 2008, an acknowledgment of JLL’s ability to kick start movement in a recovering sector of the market. Pantzer Properties, a fully integrated owner and operator of investment properties, and Dune Real Estate Funds teamed up in a 50/50 joint venture to acquire the assets. JLL leveraged its experience with large transactions and represented the sellers through the complex terms of the deal. The sale closed with a new price and a reduced debt of $390 million.
CONTACT INFORMATION:Al Cissel email@example.com +1 301 564 6622
Scott Melnick firstname.lastname@example.org +1 301 564 6619