News and Releases
September 03, 2010
Virtú Investments Acquires the Village at Lake Mary Crossing Apartments
*Flagstaff, AZ*— Virtú Investments, LLC, a San Francisco based real estate investment management firm, purchased the 224-unit Village at Lake Mary Crossing located at 3400 Lake Mary Road in Flagstaff, AZ for $14,000,000, representing a cost of $62,500 per unit or $62 per square foot.
The purchase of the Village at Lake Mary Crossing allows Virtú Investments to acquire an apartment complex built in the late 90’s in a highly occupied market at a purchase price that is approximately 50% of local replacement costs. The property is divided into two separate phases, where construction materials and building designs are identical and the phases are adjacent. Phase-I is 124 units that are operating under the Section 42 Low Income Housing Tax Credit Program with rents and income restrictions. Phase-II is 100 units of market-rate housing primarily serving students attending Northern Arizona University, which is within a mile of the property.
Virtú’s investment strategy is to divide this large single property into two distinct and separate assets. The division and repositioning will create a student-oriented property with student-oriented marketing and management and a differentiated LIHTC-oriented property with LIHTC-oriented marketing and management. Operating as separate properties will better serve its tenants and will allow Virtú to prepare the student-oriented phase for a near term sale into a market of buyers looking for student housing communities.
Mike Bryant and Brad Peters of Berkadia Commercial Mortgage, LLC procured non-recourse fixed-rate 10-year financing from Basis Investment Group on behalf of Virtú. This long term financing was structured with two notes, which allows for separate disposition of the two phases, mitigates interest rate risk, and positions Virtú for a long term hold on this asset.
The Village at Lake Mary Crossing Apartments acquisition was sourced by Virtú’s West Coast Acquisitions Director Stu Bone. Mr. Bone worked with Tim Flint and Armand Tiberio at Marcus & Millichap’s National Tax Credit property advisors to source this acquisition and to secure the terms of this transaction.
Contact Stu Bone at (415) 999-2088 or (JavaScript must be enabled to view this email address) to discuss this or other multi-family acquisitions on the West Coast. For information concerning commercial acquisitions throughout the U.S., contact Will Fleming at Virtú Commercial (415 398-4202).