Waterton Residential has sold the 427-unit District West Gables apartment complex in West Miami for $111 million, representing a 4.7 percent decrease from its original purchase price nearly ten years ago.
The buyer, Federal Capital Partners (FCP) based in Chevy Chase, Maryland, acquired the property at 2001 and 2101 Ludlam Road/Southwest 67th Avenue. The transaction equates to about $259,953 per unit, according to records and real estate database Vizzda.
Waterton, led by CEO David Schwartz, originally purchased the two buildings for a combined $116.4 million in deals made in 2016 and 2017. In those transactions, Waterton paid $57.4 million for the building at 2101 Ludlam Road after it was completed by Estate Companies in South Miami. The following year, Waterton bought the second building at 2001 Ludlam Road for $59 million after its completion by Estate Companies.
Estate Companies developed both buildings under its Soleste multifamily brand. The firm is led by Robert Suris and Jeff Ardizon.
District West Gables sits on a 4.1-acre site and includes studios as well as one- to three-bedroom apartments. Property records do not list current asking rents.
This acquisition marks FCP’s third multifamily investment in South Florida within less than a year. In December last year, FCP bought the Solena Miramar complex with 250 units for $67.5 million in Miramar. Earlier this February, FCP also purchased Arium Sunrise with 400 units for $90 million in Sunrise.
FCP’s CEO Garland Faist leads the company that has invested or financed over $14.6 billion nationwide since its founding in 1999 and currently manages six funds totaling $4.2 billion in assets.
According to FCP’s news release announcing the purchase of District West Gables: “At District West Gables, FCP plans renovations to common areas, amenities and apartments.” Greystar has been hired to manage the property following the sale.
Records indicate that no mortgage was recorded for this transaction; this suggests that FCP may have made an all-cash purchase.
The sale occurs during a period of reduced activity compared with earlier periods of rapid growth during the pandemic era. Over recent years, higher interest rates and an oversupply of new developments have slowed investment sales while rents have stagnated or declined locally.
Last year saw developers complete approximately 18,600 new apartments across South Florida—outpacing roughly 15,000 net leases signed during that time frame (https://www.costar.com/).
Recent months have seen more investors use all-cash deals or loans from Freddie Mac and Fannie Mae instead of traditional bank financing when purchasing apartment properties.
In June this year Spanish billionaire Amancio Ortega paid $165 million cash for Veneto Las Olas—a Fort Lauderdale tower with 259 units—while Related Fund Management used a Freddie Mac loan to finance part of its $116.9 million purchase of Aura Delray Beach last month (https://therealdeal.com/miami/2023/07/05/amancio-ortega-pays-165m-for-las-olas-apartment-tower/) (https://therealdeal.com/miami/2023/08/09/aura-delray-beach-trades-for-117m-in-latest-south-florida-multifamily-sale/). Also last month Milestone Group assumed an existing loan and borrowed additional funds from Fannie Mae when acquiring Casa Brera near Boynton Beach (https://therealdeal.com/miami/2023/08/17/milestone-group-buys-boynton-apartments-assumes-fannie-mae-loan-and-adds-debt/).
