Newmark Knight Frank (NKF) has announced the sale of Aragon Holdings, LLC’s national portfolio of apartment properties to Harbor Group International (HGI), a global real estate investment and management firm, for $1.85 billion. The firm’s Capital Markets Strategies and Multifamily Capital Markets groups provided the financing and were led by Henry Stimler, Bill Weber and Matt Mense. NKF’s Zach Springer brokered the sale and leveraged NKF’s nationwide platform, cooperating with the portfolio team in local offices comprised of Mac Crowther, Brad Goff, Terrance Hunt, Brian Murphy and Scott Ramey.
The transaction is the largest multifamily sale since 2016 and the fifth largest ever recorded in the U.S. 1 The portfolio includes 36 properties (composed of 13,243 units) spanning nine primary and secondary markets across eight U.S. states. The portfolio is most highly concentrated in Dallas/Fort Worth and Denver, while Houston, San Antonio, Atlanta, Orlando, Phoenix, Salt Lake City, Albuquerque, St. Louis and Kansas City (MO) comprised the remaining markets.
“This was a landmark deal for us in terms of size and scope as we were able to work across all Newmark business lines to successfully achieve spectacular results for both the buyer and seller,” stated Anthony Orso, president of NKF’s Capital Markets Strategies group.
NKF arranged approximately $1 billion of combined new financing, while $400 million of existing debt was assumed directly by HGI. The new debt was placed in two separate pools: an NKF-originated fixed-rate loan with Freddie Mac and a short-term floating-rate loan arranged by Bank of America.
“NKF has ascended to the top of the list of firms who execute large multifamily portfolio investment sales transactions,” said Blake Okland, vice chairman, head of multifamily investment sales. “Our growing success is based on our ability to leverage deep-rooted expertise in the local markets, coupled with a strong network of national and international investors working seamlessly together to secure portfolio transactions of this size.”
HGI plans to invest approximately $90 million in property upgrades and enhancements throughout the portfolio, including $51.5 million of in-unit renovations. Harbor Group Management Company, HGI’s in-house property management firm, will assume management of the portfolio effective immediately.