UPDATED: JULY 20, 2018 10:11 AM — Atlanta-based multifamily investor Cortland Partners paid $65.75 million on Tuesday for its sixth apartment property in Central Florida, buying a 330-unit property in LeeVista Center that its local lead executive deemed a "unicorn" asset with clear value-add potential.
Located at 6850 Merryvale Lane, the 25-acre site features the former GrandeVille at Jubilee Park apartments, developed and built in 2015 by Altamonte Springs-based LeCesse Development Corp. in a joint venture with Famlee Investment Company, which developed LeeVista Center.
The sale, which reflects a per-unit value of $199,242, will be followed with a light interiors renovation by Cortland, which plans to leverage its manufacturing presence in China to produce new kitchen surfaces and material upgrades that "put these units on a competitive level with new Lake Nona product," said Kyle Bateh, Cortland's investment manager for Florida based in Winter Park.
"The first thing that attracted us was the product mix, with three-story, elevator-served buildings and air-conditioned corridors. That's a true unicorn and hard to find in this market," he told GrowthSpotter. "The other half of the property is two-story private entry homes with garages. In that area you have tons of jobs but not a lot of new product. Couple all that with the upside in renovation, because while it was built this cycle there were things we saw we could leverage with our materials procurement."
The buyer rebranded the property this week as "Cortland Jubilee Park." It's zoned for Lake Nona public schools, and has the largest floorplans in the submarket at an average of 1,165 square feet, Bateh said.
"The sale is a perfect example of the incredible demand for well-located Class A properties in Central Florida," said Scott Ramey, director for ARA Newmark in Orlando and listing agent for the Jubilee sale. "The property's unique design is the only one of its kind in the market, resulting in an extraordinarily fast lease-up in 2015. Design combined with access to the coveted Lake Nona school district and a world-class airport will maintain strong performance in the years to come."
Cortland assumed a Freddie Mac mortgage from the seller with more than $41.588 million in unpaid principal, and an additional loan amount of $2.411 million coordinated by Walker & Dunlop, set to mature in August 2028.
With the purchase, Cortland Partners now owns approximately 2,750 units across its six Central Florida properties, Bateh said.
LeCesse and Famlee are proceeding with a second multifamly phase at Jubilee Park directly south of Cortland's new property, planning 312 units on 28.1 acres with a portion dedicated to Humphreys & Partners' "Big House" design.