An affiliate of Boca Raton-based family investment firm Amzak Capital Management paid $36.7 million last week for three Class C apartment complexes in west Orlando, with plans to invest heavily in renovations to elevate each to Class B status.
The deal follows Amzak's $15.1 million purchase in late December of the triple net-leased Del Frisco's Double Eagle Steak House on International Drive, which was a rare deviation for the company from its multifamily focus.
"We see a shortage of affordable places to live in Orlando, and feel like we're doing a good thing in the community by taking on this portfolio," vice president of real estate Luis Espinal told GrowthSpotter. "We'll spend about $5,200 per door in renovations and upgrades to make these nicer, safe environments."
Amzak paid more than $12.98 million for the 190-unit Eagle Landing apartments at 4500 Silver Star Road, which make up the bulk of the former Los Robles Condominiums, a 200-unit complex which covers 10 acres.
The company also paid $13.69 million for the 192-unit Eagle Bend apartments at 4757 Silver Star Road, a 7.7-acre property based directly east of Evans High School that features seven two-story buildings that were built in the mid-1970s.
And the third was roughly $10 million for the 188-unit Eagle Summit apartments at 3000 S. Rio Grande Ave., a 8.8-acre property with 14 two-story buildings dating to 1973.
The sales closed on Feb. 7, and were recorded Monday morning in Orange County. All three were self-financed by Amzak Capital, and partially funded with the remaining proceeds of a 1031 exchange opportunity initiated last year.
Average occupancy rate was in the low 90s at time of sale. A small percentage of units across the properties are designated as Section 8 housing, said Espinal, which the new owner will maintain. Meadow Wood Property Company took over management last week.
The sellers of all three were affiliates of Ormond Beach-based Lohman Apartments, which previously paid $8.525 million in December 2016 for Eagle Bend, $8.08 million in August of that year for Eagle Landing, and $6.627 million for Eagle Summit in May 2015.
"The price of these apartments has more than doubled since we bought them. We bought more than 3,800 apartments in these last six years and it's time to divest a few," co-founder Lowell Lohman said. "Last week we also signed a contract to sell six apartment complexes for $51.7 million in Jacksonville ... and we were in Orlando Friday to make an offer on another complex."
This portfolio buy now brings Amzak's multifamily holdings in Greater Orlando to five properties totaling 880 units. Over the last two years, the company has purchased more than 2,200 units in the Interstate 4 corridor, and is developing a 240-unit complex in Ybor City in a joint venture with Bainbridge Companies.
Looking forward, Amzak is actively looking for more Class C-level multifamily assets in Greater Orlando that offer deferred maintenance and value-add potential to elevate to Class B, Espinal said.