FPA Multifamily Buys Suburban Chicago Asset via Assumable Debt

FPA Multifamily’s suburban buying streak hauled in a property with an assumable loan.

Chicago’s Rockwell Partners sold the 356-unit Huntington Apartments, at 20 South Naper Boulevard in Naperville, for $68 million to San Francisco-based FPA Multifamily, Crain’s reported. That’s $191,000 per unit.

FPA assumed the balance of Rockwell’s existing mortgage, about $39.8 million, which carries an interest rate under 3.6 percent and matures in 2029. The assumable debt likely sweetened the deal, as interest rates for this type of asset hover near 5.22 percent.

Newmark brokers Susan Lawson, Chuck Johanns and Elizabeth Gagliardi represented Rockwell in the transaction.

The deal also reflects the growing appeal of DuPage County, which investors view as less burdensome for property taxes as Cook County.

Rental demand is strong, with median net rent rising 4.4 percent year over year in the fourth quarter to $2.90 per square foot, according to Integra Realty Resources.

Huntington Apartments, built in 1973. Originally apartments, it was converted to condos in 2007, but units failed to sell amid the 2008 financial crisis.

Rockwell acquired 313 units for $34 million in 2016 and spent the next few years buying the remaining 43 units and converting the property back to rentals. Rockwell invested close to $50 million into the acquisition and property upgrades, including $7 million to renovate 90 percent of the units and enhance amenities like the clubhouse.

FPA Multifamily has been an active investor in the Chicago-area market.

Last month it sold the 294-unit ReNew Downers Grove apartments for $72.1 million, and last year acquired properties in Hoffman Estates and Chicago’s South Loop for more than $100 million each.

— Judah Duke