RREAF Holdings LLC, 3650 REIT and DLP Capital have all partnered in the acquisition of Southeast Multifamily Portfolio III, with a capitalization of approximately $500 million, and includes two properties in Arkansas.
Including 10 multifamily properties, the portfolio also includes over 2,744 units in Arkansas, Georgia, Indiana, Mississippi, North Carolina, Oklahoma and South Carolina – marking the trio’s third acquisition in less than a year. Two properties located in Arkansas are included in this $500 million portfolio, including Glen at Polo Park – which is located in Bentonville – and River Pointed – which is located in Maumelle. Other properties included are Village Mill Creek in Statesboro, Georgia; Echo Ridge and Pheasant Run in Indianapolis, Indiana; Waterford Place in Greenville, North Carolina; Reserve at Long Point in Hattiesburg, Mississippi; Traditions at Westmoore in Oklahoma City, Oklahoma and 5iftyOne at Traden Heights in Stillwater, Oklahoma; and Broad River Trace in Columbia, South Carolina.
The Southwest Multifamily Portfolio III is one of the largest multifamily transactions in 2022, infusing significant capital into quality workforce rental units. By 2035, 4.3 million more apartments are needed to meet the demands for rental housing according to the National Multifamily Housing Council.
RREAF spearheaded this acquisition, purchased from one seller and primarily, all of the apartment complexes are in suburban-metro areas – where there are no new multifamily supply within a five mile radius of where most of the properties are located. Built between 1998 and 2012, these properties currently have a 93% collective occupancy. Significant renovations will be made to all units, as stated in the news release. These renovations include electric automobile charging stations, dog runs, pickleball courts and business centers with fiber cable, updating pools, tennis courts, outdoor kitchens, entertainment packages, clubhouses and more efficient lighting. In previously collaborating in producing superior results for investors with TransCoastal 21, RREAF, 3650 REIT and DLP Capital also collaborated on the Gulf Coast II portfolio.
“The closing of the Southeast Multifamily Portfolio III marks a milestone for our firm for affordable, quality hosing options to renters in the Southeast as RREAF continues our business plan of providing superior living options at an affordable price,” Kip Sowden, the chief executive officer of RREAF Holdings, said. “The size and versatility of the portfolio represents our continued success. We would like to extend a thank you to our partners, DLP Capital and 3650 REIT, on their partnership in this landmark portfolio.”
Nathan Stone and Guy Griffith at Berkadia, a leading multifamily investment sales advisor, mortgage banker and loan servicer, provided financing for this portfolio in addition to the equity capital provided by the three portfolio partners. RREAF Residential, RREAF’s in-house property management company, will take over property management on all assets. As a fully integrated property-management firm, RREAF Residential specializes in workforce housing communities and RREAF’s multifamily division has over 12,00 units under ownership, with a transaction volume of $1.4 billion in the past year.
“SMPIII marks our third portfolio transaction with RREAF and DLP Capital, totaling more than 7,500 multifamily units, and is a continuation of our focus on building long term relationships with best-in- class sponsors. RREAF has consistently demonstrated their ability to outperform the market while delivering high quality attainable housing to their residents and we look forward to continuing to support their strategic growth plans. The transaction also reflects our continuing belief in the strength of the multifamily market in the Sunbelt states as migration patterns continue to drive demand in these markets in the face of the ongoing housing shortage and economic headwinds nationwide,” Jonathan Roth, Co-Founder and Managing Partner of 3650 REIT, said.
“The affordable housing crisis pervades every state in the nation, making this multifamily transaction all the more significant,” Don Wenner, Founder and CEO of DLP Capital, said. “Through our collaborative investment and our mission to keep these apartments affordable for the local workforce, we will impact hundreds of families who want to live where they work. Additionally, we can deliver targeted returns to our loyal investors who believe in our mission.”
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