11 May Apartments change hands in record deal
The Longfellow Arms apartment complex at 115 E. Hawkins Parkway in Longview has changed hands as part of a transaction that included 11 Texas properties and set a record with the U.S. Department of Housing and Urban Development.
Chicago-based Atlas Residential said its purchase of the $250 million, 2,400-unit multifamily residential portfolio closed Dec. 30. Dallas-based Pillar Income Asset Management previously owned the properties.
Atlas said the transaction was the largest such transfer approved by HUD, and Macquarie Bank Limited provided $71 million in mezzanine financing.
Mark Copeland, chief operating officer for Atlas, said the previous owners purchased the properties with HUD-guaranteed loans. His company agreed to purchase them in March 2013, but HUD had to approve the transfer to assume the loan.
The 11-property portfolio includes apartments in Dallas, Houston, Midland/Odessa and El Paso.
Atlas says it will make “cosmetic enhancement and physical upgrades” at the properties. Copeland said that will include improvements at the 240-unit Longfellow Arms.
The upgrades will mean residents who want the upgrades will see rent increases from 3 percent to 5 percent.
Atlas is moving into the Longview market at a time when several new upscale complexes are under construction.
“In our minds that’s kind of a good thing,” Copeland said, because those properties likely will have higher rents than Longfellow Arms, helping to attract new tenants or encourage existing tenants to stay.
“We’re finding there’s more renters. Our market studies have found more renters by choice.”