Asset manager PGIM has helped a developer refinance a large Southeast apartment portfolio, joining other investors in increasing their bets on the multifamily market's rebound.
PGIM, the Newark, New Jersey-based business of Prudential Financial, said it provided $619 million in fixed-rate financing to apartment firm HHHunt Corp. A spokesperson for HHHunt defined the actions as "a refinance" in an email to CoStar News, but declined to comment further.
The deal comes after U.S. multifamily sales increased 6% year over year in the second quarter, according to CoStar's latest multifamily report, following a 40% jump in the first quarter. The sales momentum pulled back slightly in May due to macroeconomic trends and uncertainty resulting from quickly shifting headlines.
"Even so, rising deal volume is more than noise — it's often the first sign of a market recalibrating," according to the report. "Historically, price recovery in the multifamily sector has followed the same rhythm: capital returns to the market, deal flow accelerates, and valuations gradually firm. That cadence is returning."
The move involving PGIM was structured into two portfolios — one with Freddie Mac and the other with Fannie Mae — comprising one with $412.771 million that closed first and the other with $206.16 million that closed a week later.
"The two-step portfolio structure allowed us to unlock significant value for the borrower," said Lee McNeer, executive director for PGIM's real estate business, in a statement.
PGIM is providing financing for a large multifamily development firm as investors' interest in apartments picks up despite economic headwinds.
Properties across six states
The properties in the HHHunt refinance include a mix of mid-rise and garden-style apartments located across North Carolina, South Carolina, Virginia, Maryland, Tennessee and Georgia, according to PGIM, a company that calls its real estate business the world's third-largest real estate investment manager. The portfolio comprises 4,237 apartments built between 2001 and 2023.
The portfolio generally is located in markets where multifamily demand is on the rise, CoStar data shows.
Atlanta's apartment market is seeing one of its strongest demand surges in recent years. Demand is also heating up in Nashville, Tennessee, and the Carolinas.
HHHunt owns and manages more than 8,600 apartments across the mid-Atlantic and Southeast, with another 1,580 units under development.
The properties involved in the transaction, according to PGIM, are:
- Abberly Crest Phase 1 at 46850 Abberly Crest Lane in Lexington Park, Maryland.
- Abberly Crest Phase 2 at 46850 Abberly Crest Lane in Lexington Park, Maryland.
- Abberly Crossing at 9698 Patriot Blvd. in Ladson, South Carolina.
- Abberly Place II Apartment Homes at 500 Abberly Crest Blvd. in Garner, North Carolina.
- Abberly Twin Hickory at 4700 The Gardens Drive in Glen Allen, Virginia.
- Abberly Village at 1000 Abberly Village Circle in West Columbia, South Carolina.
- Abberly Waterstone at 140 Abberly Drive in Stafford, Virginia.
- Abberly West Ashley at 3100 Ashley Town Center Drive in Charleston, South Carolina.
- Abberly Woods Phase 1 at 5301 Roundstone Way in Charlotte, North Carolina.
- Abberly Woods Phase 2 at 5301 Roundstone Way in Charlotte, North Carolina.
- Abberly NoDa Vista at 2120 N Brevard St. in Charlotte, North Carolina.
- Abberly Foundry at 640 21st Ave. N in Nashville, Tennessee.
- Abberly Riverwalk at 115 Great Circle Road in Nashville, Tennessee.
- Abberly Onyx at 2532 N Decatur Road in Decatur, Georgia.
- Abberly Skye at 2550 Blackmon Drive in Decatur, Georgia.