Avenel on 16th Apartments, a recently repositioned property, located near 16th Street and Indian School Road in the dynamic East Camelback/Uptown Phoenix submarket, sold for $25,950,000.
NorthMarq’s Phoenix investment sales team, Trevor Koskovich, Jesse Hudson and Bill Hahn, brokered the sale and represented both buyer and seller in this transaction.
Taurus Investment Holdings, LLC, a global real estate private equity firm headquartered in Boston, Massachusetts, was the buyer.
“We believe that Phoenix is a great growth market. The purchase of Avenel on 16th represents Taurus’ confidence in the prospects for this region. This investment is a fantastic opportunity for us to participate in the continued transformation and future development of a premier submarket at a price that is a significant discount to replacement cost,” said Peter A. Merrigan, CEO of Taurus.
“Avenel on 16th is conveniently located in the East Camelback submarket which attracted the buyer due to its immediate proximity to major employment hubs, providing over 13,000 jobs within a one mile radius of the asset,” said Hudson, vice president at NorthMarq. “During a time of market uncertainty, it took cooperation from all parties involved: purchaser, seller, broker, and lender, to facilitate due diligence, property inspections, secure financing, and negotiate reasonable terms to close.”
Financing for the acquisition included an $18,790,000 Freddie Mac loan which was arranged by NorthMarq’s Bryan Mummaw, senior vice president. “The client had numerous finance alternatives at the time of acquisition but selected NorthMarq/Freddie Mac due to their certainty of execution, excellent loan terms and integrated direct lending platform,” said Mummaw.
The seller was Phoenix-based Rincon Partners. Their strategy is to identify multifamily properties that have the potential to deliver double-digit returns. They achieve this by renovating and repositioning the property, improving tenant mix, and efficiently controlling operating expenses. Rincon spent over $4 million on capital improvements and interior renovations at Avenel on 16th.
The 200-unit Avenel on 16th apartment community, built in 1980 and 1984, comprises 14 percent studios, 69 percent one-bedroom units, and 17 percent two-bedroom units. The property, located on the east side of 16th Street and south of Indian School Road, is situated in the dynamic East Camelback/Uptown Phoenix submarket. Residents of Avenel have easy access to the popular Arizona Biltmore Golf Course, Arcadia Neighborhood, Camelback Mountain hiking, and a direct route to both Downtown Phoenix and Old Town Scottsdale shopping and dining. The Camelback corridor boasts excellent demographics including a $69,344 average household income within three miles, population growth since 2010 of 26 percent within three miles, and 58 percent of the population within three miles identified as renters (source: Costar). The Camelback Corridor employment center hosts a dynamic mix of premier office, high-end retail and hotel development that serves as a focal point for business and entertainment activity in Phoenix. The workforce in the Camelback Corridor is well educated and highly skilled. Approximately 33 percent of the labor force that resides within a 20-minute commute is managerial, executive or professional in nature.