Fairfield has acquired a 15-property multifamily portfolio with nearly 4,000 units from Sunroad Enterprises. JLL’s Capital Markets group, working on behalf of the seller, arranged the $1.1 billion transaction.
Comprising a portion of Sunroad’s overall portfolio, the 15 geographically diverse properties—six Class A core and nine value-add assets—had been assembled over a six-year period. With an average vintage of 2011, 65% of the properties are garden-style and 35% are mid-rise. The properties, totaling 3,830 units, are located in six states—Arizona, Colorado, Georgia, Nevada, North Carolina, and South Carolina. They include:
• 1000 West in Charleston, South Carolina;
• Adara at Godley Station in Savannah, Georgia;
• The Avenues at Verdier in Charleston;
• The Banks at Rivergate in Charlotte, North Carolina;
• Colton in Henderson, Nevada;
• The Laurel in Chandler, Arizona;
• Lazo in Chandler;
• The Nines at Kierland in Scottsdale, Arizona;
• Portola at Southglenn in Centennial, Colorado;
• Slate Scottsdale in Scottsdale;
• Talus Flats in Castle Rock, Colorado;
• Verde Vista in Asheville, North Carolina;
• Zone in Glendale, Arizona; and
• Zone Luxe in Glendale.
“These assets are some of the most desirable from a location, positioning, and improvement perspective,” noted Dan Feldman, president of San Diego-based Sunroad Asset Management. “JLL conducted a strategic analysis of top-tier capital partners, and Fairfield, with their strong financial backing, made sense for us. Sunroad was focused on alternative exit strategies, which enabled liquidity to be created while not divesting of the assets. This was the perfect solution for Sunroad.”
JLL arranged $415 million in financing for 10 of the properties with Freddie Mac; the loan will be serviced by JLL Real Estate Capital, a Freddie Mac Optigo lender. In addition, $250 million of financing was secured from accounts managed by global investment firm KKR.
JLL’s Capital Markets advisory team was led by senior managing directors Aldon Cole, Roberto Casas, and Tim Wright as well as vice president Bharat Madan. The Nevada asset was handled by managing director Mark Wintner.
“This unique transaction brought together Sunroad Enterprises and Fairfield, two of the U.S.’s most capable multifamily operators,” said Cole. “Despite headwinds in the broader economy, this transaction demonstrates strong demand and liquidity in the multi-housing sector for both core and value-add properties as evidenced by the scale of this transaction.”
Wes Dickerson, executive vice president at San Diego-based Fairfield, added that the firm was attracted to the quality of the assets and their locations in high-growth markets.
“Sunroad has done an excellent job maintaining the portfolio in an institutional manner and has executed a top-of-the-line renovation strategy that we look forward to completing as partners. Fairfield has been focused on specialized recapitalization opportunities across our various investment vehicles for the past year, and this transaction is representative of that strategy,” Dickerson said.