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Pollack Shores, Carlyle Sell Midtown Apartment Community for $86.5 Million

D.C.-Area Investor Snags The Local on 14th in Top 10 Multifamily Deal
December 15, 2017
A Washington, D.C.-area family investment group has acquired a West Midtown apartment community for $86.5 million. The overall price ranks the transaction as the sixth-largest multifamily sale in the Atlanta market this year, according to CoStar Research.

The investment group, 50 East 69th Street Corp. of Potomac, MD, closed Nov. 14 on The Local on 14th, a 360-unit community across the street from the Al-Farooq Masjiq Mosque. The seller was CRP/Pollack 14th Street, LLC, a partnership between Washington-based The Carlyle Group and Atlanta-based Pollack Shores Real Estate Group.

The buyer secured $51.9 million in financing from American General Life Insurance Co. after a 60-day escrow to close the deal, according to CoStar Research.

Pollack Shores developed The Local on 14th, and the first residents took occupancy in July 2016. The community's location near Georgia Tech helped Pollack Shores' company Matrix Residential quickly lease up the property. The Georgia Tech Foundation sold land for the development to Pollack Shores in late 2015.

Atlanta's West Midtown submarket has emerged as one of the market's hottest for development as millennials and others move intown. Popular mixed-use properties such as Westside Market, Brickworks Atlanta and White Provision also have fueled the desire to live in the area.

"The demand for apartments near the urban core has focused attention on the long-ignored West Midtown neighborhood, specifically along Howell Mill Road," CoStar Research states in its latest Atlanta Apartment Overview. "And even though absorption of new units here has slowed below the metro average, the anticipated job and renter-household growth there should sustain the pipeline over the long term."

The Local on 14th, listed for sale by Walker & Dunlop, was on the market less than six months. A week after the sale of The Local on 14th closed, Pollack Shores completed the sale of Millworks for $80 million. Also new construction, Millworks is situated at 1888 Emery St., fewer than three miles from The Local on 14th.

While Pollack Shores' pair of sales helped pick up the pace of multifamily sales, it is unlikely the market will match its record pace of 2016, according to CoStar's Atlanta Apartment Overview.

"Regardless, media pricing continues to climb and is now more than 200% higher than the levels recorded in 2011. Further, 2016 was particularly inflated because of the massive merger of Post Properties and MAA," the CoStar report states. "That deal saw 14 communities acquired by MAA in Atlanta, valued at close to $1.1 billion and totaled 6,000 units."

For more information on the transaction, please see CoStar Comp #4070832.

Tony Wilbert, Atlanta Market Reporter  CoStar Group   
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