SEATTLE, WA – Security Properties and Pacific Life Insurance Company bought Overlook at Lakemont, a 400-unit, Class B multifamily property located in Bellevue, WA, for $118,000,000.  This was Security Properties’ first joint venture with Pacific Life.

Overlook is located in the prestigious Lakemont community where the average home price is nearly $900K and the average income within three miles of the subject is $130K.  Lakemont is part of the Issaquah school district which is repeatedly ranked as one of the top districts in the state.  Living at Overlake allows residents access to both the schools and the reputation associated with Lakemont at an affordable price point.

The location is fantastic as it has a low density, suburban feel, but offers walkable retail including Starbucks and a high end local grocery store, Town and Country, that will be undergoing renovations.  To the northeast of the subject is Lakemont Park and to the southwest is Lewis Creek Park.  Additionally, less than one mile east is Cougar Mountain Park a 5,000 acre protected wildland area designated for hiking and horseback riding.  Transportation is fantastic as well with an I-90 entrance just over a mile away.  Major employers that operate their corporate headquarters within 6 miles of Overlook include Microsoft, Costco, Expedia, T-Mobile, Paccar and Puget Sound Energy.

The subject was built in 1992 and, with a few exceptions, is in original condition.  The business plot is to renovate all of the units as well as update the clubhouse, replace the roof, re-side the property, and paint the exterior.  The end result will be a core asset in an A+ location.  This is the only property in Bellevue of over 250 units built in the 90’s so it does not have some of the functional obsolescence of 80’s construction product, but it has an in-fill location that is irreplaceable. 

Davis Vaughn, Investment Manager at Security Properties says they bought this property because, “this was a rare opportunity for us to buy in one of the best residential neighborhoods in the Seattle metro.  The quick I-90 access provides convenient commuting to some of the top employers in our region and the area demographics are outstanding.  We reckon our renovation program will absolutely transform the asset and provide the high quality product that Lakemont expects.”

The property will be managed by Security Properties-affiliate Madrona Ridge Residential.

Overlook at Lakemont was bought from Heitman. The sale was led by Jeff Williams, Chris Ross and Tim Brown of Moran & Company.

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TALLAHASSEE, FL – Preferred Apartment Communities announced the acquisition of Campus Circle, a 219-unit, 679-bed student housing community located near Florida State University in Tallahassee, Florida.  PAC bought this asset through its wholly-owned subsidiary Preferred Campus Communities.   

Preferred Campus Communities financed the acquisition by assuming the existing first mortgage loan with a maturity date of October 1, 2022 and an annual interest rate of 4.02%.  

“We believe this acquisition represents a strong, strategic go into the student housing sector.  This property is well located with simple pedestrian access to campus.  We feel the modern features, including a resort-style pool, a fitness center and other student-centered amenities are very appealing to the resident base,” said Paul Cullen, PAC’s Chief Marketing Officer and Chief Executive Officer of PCC.

PAC also announced that on January 1, 2016 Preferred Campus Management started operating as a manager of student housing communities.  PCM is a wholly-owned subsidiary of Preferred Apartment Advisors, the Company’s external manager.  PCM will manage the Campus Circle community for PAC. 

In addition to Campus Circle, PCM currently manages seven newly constructed student housing projects in five states having an aggregate of 5,296 beds.  PAC provided a part of the proceeds for the construction of each of these communities for which PAC received an option to buy following stabilization at a discounted price to market.  Upon the acquisition of any of these student housing communities, PAC intends to buy them through PCC and to engage PCM as its property manager.

PAC is also pleased to announce that Kimberly (Barkwell) Hodge was brought on as President and Chief Executive Officer for PCM at inception.  Kim currently oversees all facets of PCM’s operations, including strategic initiatives, financial oversight, business services, property performance and company culture enhancement.  John A. Williams, the Company’s Chief Executive Officer said, “Kim is a seasoned student housing and multifamily veteran with over 35 years of experience in all sectors of property management.  We are thrilled that she is leading the PCM team.”

Ms. Hodge became a partner at Ambling Property Investments in 2004 and in 2008 was appointed President of Ambling Student Housing/Ambling Management Company.  Under her leadership, Ambling operated over 25,000 student housing beds, as well as Ambling’s owned portfolio of 83 conventional, senior and affordable housing assets totaling nearly 13,000 units. 

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CHICAGO, IL – In keeping with its mission to preserve affordable housing, The NHP Foundation, a national nonprofit, is the new owner of the Mark Twain Hotel, a mixed use Single Room Occupancy property located at the interstation of North Clark and West Division Streets. The acquisition was made possible by financial partnerships with Pembrook Capital Management LLC, The Chicago Community Loan Fund, Bellwether Enterprise Real Estate Capital, US Bank, and the City of Chicago Department of Plotting and Development. The NHP Foundation will maintain the property as affordable apartments pursuant to Chicago’s new Single-Room Occupancy Preservation Ordinance.

“Since 1932, the Mark Twain Hotel has been a landmark of the Gold Coast neighborhood. The acquisition and future renovation of the property by The NHP Foundation is an incredibly exciting project for all parties involved,” NHPF’s President and CEO Richard Burns, said. “We are proud to be a part of Chicago’s efforts to preserve its affordable housing and we are delighted with the opportunity to significantly improve the property while providing a better quality of life for the residents.”

The Mark Twain Hotel is located at 111 West Division Street. Originally built in 1932, the approximately 58,000 square foot building has 152 SRO units and over 9,000 square feet of retail space on the ground floor. The Red Line station beneath the building underwent a complete $50MM renovation in September 2015, including installation of elevators and escalators, a new entrance at LaSalle & Division, and a new 8,000 square foot mezzanine. The property is well-located in a mixed use neighborhood and is across from The Sinclair, a residential tower and Jewel/Osco supermarket construction project that will be completed in 2017.

“We are thrilled to see the hard work that we did with the city to pass the SRO Ordinance result in the preservation of the Mark Twain as affordable housing,” said Norman Kaeseberg, a tenant organizer and member of ONE Northside, a local community organization. “This is exactly the type of outcome we were seeking when we were organizing around the ordinance. It’s a victory for the tenants, the city, NHPF, the previous owner, and ONE Northside.”

Bellwether Enterprise Real Estate Capital worked with NHPF to bring debt and equity to the transaction from Pembrook Capital Management LLC, The Chicago Community Loan Fund, and US Bank. Pembrook, a commercial real estate investment manager and balance-sheet lender, primarily funded the property acquisition with a $16.6 million loan. The Chicago Community Loan Fund is the junior lender.

“The Chicago Community Loan Fund was proud to provide financing to the historic and vital Mark Twain SRO. The City of Chicago has demonstrated its commitment to preserving SRO properties through a variety of efforts, including the passage of the SRO ordinance in 2014, and CCLF stands with the City and NHP Foundation in helping to preserve one of Chicago’s greatest strengths — its diverse housing stock.” – Bob Tucker COO and Executive Vice President of Programs for Chicago Community Loan Fund.

The City of Chicago’s Department of Plotting and Development issued the Illinois Affordable Housing Tax Credits (also known as Donations Tax Credits) for the benefit of the project. The tax credits generated were sold to US Bank whose equity was used to buy the property. As such, the project will remain affordable for a minimum of 10 years.

“As part of its mission to transform lives through affordable, desirable housing, The NHP Foundation is delighted to be part of the solution to a dire housing problem in the City,” said Mecky Adnani, VP of Acquisitions and Development at The NHP Foundation.

“The acquisition of the Mark Twain Hotel, the largest acquisition under the city’s 2014 SRO Preservation Ordinance, is the first vital milestone in ensuring that existing tenants will not be displaced,” Ms. Adnani added. “We will now continue our mission to preserve the affordability, to comprehensively rehabilitate, and to fully reposition the Mark Twain in one of the rapidly growing neighborhoods of Chicago. When done, this property will be a transformed, state-of-the-art SRO facility with amenities and a full array of resident services.”

The NHP Foundation is working on the redevelopment phase for the project, with plans to add kitchens to each unit and community space to the property. Construction is anticipated to start in 2017 with the goal of limiting displacement for existing residents. The property will be included in the National Register’s Proposed Residential Hotels in Chicago, 1900-1930 group designation, which recognizes the accommodation from this era as historically significant. The Mark Twain property is professionally managed by Heartland Housing, a company of the Heartland Alliance.

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