Tribridge, Bluerock Joint Venture on $175K-Per-Unit Triangle Acquisition
- Jun 09, 2015
by Adriana Pop, Associate Editor
In a joint venture partnership with Bluerock Residential Growth REIT (BRG), Atlanta-based Tribridge Residential LLC has closed on its third acquisition of a large multifamily community in the Triangle region.
According to the Triangle Business Journal, the newly built Whetstone Apartments at 501 Willard St. in downtown Durham sold for $35.6 million. Back in March, Armada Hoffler Properties, the seller of the 204-unit Class AA complex, announced it would be selling the asset, without disclosing the identity of the buyer.
In its pre-sale acquisition, Tribridge Residential was represented by Allan Lynch and Justin Good with Cushman & Wakefield/Thalhimer.
The company’s joint venture partner BRG made a convertible preferred equity investment of $12.2 million. Under the invest-to-own agreement, the firm will be entitled to a current-pay preferred return on investment of 15 percent per year. Once the project is stabilized, it will have the right to convert its investment into a majority equity position.
The community’s per-unit purchase price of approximately $175,000 represents a nominal stabilized cap rate of approximately 6 percent. These figures compare favorably to similar assets in the market exceeding $200,000 per unit with cap rates of between 4.75 and 5.0 percent.
Last October, Tribridge paid $38.7 million to purchase the 319-unit Harrison Grande apartment community in Cary. Later in January, the company also closed on the blockbuster $65 million acquisition of the 244-unit 401 Oberlin apartments in Raleigh.
Photo credits: whetstoneapartments.com