One of the last large-scale, value-add multifamily portfolios in Cherry Creek sold for $56.35 million.
Chicago-based Laramar Group purchased the portfolio, which comprises The Rise at Cherry Creek at 848 S. Dexter St., The Edge at Cherry Creek at 4600 E. Kentucky Ave. and The Vue at Cherry Creek at 4805 E. Kentucky Ave. in Denver.
“The Cherry Creek value-add portfolio offered a true infill location and the opportunity to gain a significant market presence in one acquisition. The properties together provide one of the better amenity packages within the submarket, which will help unit renovations to achieve the highest rents possible. Many of the 1,000 units we have sold within Glendale in the past 12 months are of similar vintage, and differentiation combined with scale creates an opportunity to maximize returns,” said Matthew Barnett of CBRE.
Barnett, along with CBRE’s David Potarf and Dan Woodward, represented the seller, a limited partnership sponsored and managed by Granite Capital Group and Granite Peak Properties, in the sale of the properties which total 302 units across five buildings.
The three communities, built between 1965 and 1973 on a total of 5.23 acres, were around 95 percent occupied at the time of sale.
Located within one block of each other, residents at each property have access to the amenities of all three communities, including indoor/outdoor pools and hot tubs, a 24-hour fitness center and dog run.
The partnership that sold the communities purchased The Edge and The Rise in 2011 and The Vue in 2013. Renovations included improved cabinets, counters, flooring, paint, plumbing and light fixtures while common area upgrades included landscaping, exteriors, hallways, elevators and clubhouse improvements.
“These three properties are the type of offerings that GCG strives to provide its investor clientele,” said Bruce Savett, GCG founder and principal. “We look to purchase a well-located property that would benefit from upgrading the interior and exterior, often in proximity to newer and better conditioned properties. The Edge, The Rise and The Vue are adjacent to newer A quality properties. While we could not bring these older properties to A condition, by bringing them up from C to B, we were able to improve rental income significantly.”
Laramar Group is expected to further update the units and bring them to the “next level,” noted Barnett.
“As many comparable properties in the immediate area have already been renovated and are achieving higher rents, this was the last large-scale concentration of apartments available for a proven value-add renovation program,” said Potarf. “Rental demand in the area will remain strong compared to home ownership as supply of for-sale homes is extremely limited and single-family homes in the vicinity are among the most expensive in the metro area.”
The combination of the Cherry Creek location and value-add opportunity drew 15 offers on the assets, he added.
The Rise, The Edge and The Vue are located just east of Colorado Boulevard and south of Cherry Creek Drive.