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New Haven-Area Rentals Fetch $136 Million in Largest Apartment Sale in Connecticut History

Jones Street's Purchase of Town Walk Sets New Record for Nutmeg State, Though a $165 Million Apartment Sale in Downtown New Haven May Not be Far Behind
August 31, 2018
Boston apartment developer Jones Street Investment Partners has closed on an apartment complex near New Haven in a deal that registers as the largest single multifamily sale ever in the state of Connecticut, though the record may have a short run.

Jones Street paid $136.5 million, or about $179,000 per unit, for the Town Walk at Hamden Hills, a sprawling 764-unit, garden-style complex in Hamden. Located at 100 Town Walk Dr., the property is about 75 miles northeast of downtown Manhattan, and just outside New Haven.

Rental properties in Connecticut have sold for more on a per-unit price basis. But the Town Walk is the biggest pure dollar price paid in the state for any single apartment property, according to CoStar data and area brokers.

Until now, the record had been $134.7 million. That's what Capri Investment Group of Chicago paid for the 101 Park Place apartments in Stamford, Connecticut, in January 2014. That translated into $401,000 per unit for the 336-apartment complex.

Home to Yale University, Quinnipiac University and the University of New Haven, the city is a college town, with education and health services as the biggest employment sectors. Neither sector is renowned for its skyrocketing growth, and the local economy reflects that with some of the highest unemployment rates in the Northeast, according to CoStar research.

Even so, development of new apartments has been nearly negligible in recent years, keeping the vacancy rate stable and low.

However, there are two future developments proposed in New Haven that could be market changing. Northland Investment Corp. has begun demolition of an aging housing project called Church Street South. The Newton, Massachusetts-based developer is looking to build a mixed-use development with about 1,000 apartments. Work just began this spring.

And at 275 South St., the site of the former New Haven Coliseum arena, the city of New Haven has selected a Canadian developer to re-develop a site for another 1,000 apartments. LiveWorkLearnPlay, of Quebec, hopes to begin work on the project next spring.

Hamden is part of the relatively small but steady New Haven apartment market. The average vacancy in the market is 4.5 percent, a notch below the 5.7 percent national average, according to CoStar data. A good chunk of the rentals in the market are clustered around Yale University.

Though it sets the watermark for now, Town Walk's pricing record may not last long. CBRE is currently marketing 360 State St. in downtown New Haven. That 500-unit, 32-story tower is expected to attract bids of $165 million, or more.

Developed in 1992, the Town Walk community is now about 95 percent leased. But the age of the property may make it ripe for some unit improvements that could boost rents.

The apartments are a mix of one- to three-bedroom units, with walk-in closets, washers and dryers and open kitchens with white appliances. The property’s amenities include tennis and racquetball courts, a swimming pool, park and fitness center.

HK Group’s Matthew Keefe and Ricardo Cordido brokered the sale for Baker Properties, an owner-operator based in White Plains, New York.

For more information on the sale of Town Walk, please see CoStar Comp #4492593.

John Doherty, Multifamily Reporter  CoStar Group   
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