South Florida’s multifamily market felt the pinch of elevated interest rates this year.
No single-asset purchase by an institutional investor broke the $200 million threshold, marking a decline in pricing compared to last year. Even though interest rates already were higher in 2023, the biggest deal of that year was $223.5 million. This year, the biggest single-asset deal was $144 million.
The Federal Reserve’s 11 increases of the benchmark rate have made for more expensive financing, reducing investors’ buying power. Some lenders and equity investors also became more skittish, leaving buyers unable to offer top dollar for apartments. The Fed imposed two rate cuts this year, but rates remained stubbornly high.
Many of those still able to play in the South Florida market relied on discretionary funds that they needed to invest, as well as on federal agency loans that generally come at better terms than bank financing. Other buyers assumed sellers’ existing debt on properties.
The biggest deal this year was by crowdfunding multifamily syndicator Grant Cardone, who says he paid $500 million-plus for apartments in Broward County. The behemoth purchase was a cash deal of a three-property portfolio.
Here are the 2024’s top 10 multifamily sales:
1. Grant Cardone’s Broward binge
Social media personality Grant Cardone, a business advice guru who encourages companies to supercharge their growth through his 10X platform, clinched the top spot this year.
Funds affiliated with his Aventura-based Cardone Capital paid more than $500 million in cash for three apartment properties in Broward County, Cardone said.
In May, a Cardone Capital fund shelled out $149.5 million for the 382-unit Manor at Flagler Village building at 501 Northeast Fifth Terrace in Fort Lauderdale’s Flagler Village neighborhood, according to data provided by Colliers, which cited Real Capital Analytics. The purchase broke down to $391,361 per apartment.
On the heels of that deal, Cardone Capital funds scooped up the 468-unit Laurels at Jacaranda complex at 9733 Northwest Seventh Circle in Plantation in July. Cardone Capital also reportedly bought the 332-unit Edge at Flagler Village building at 475 N Federal Highway in Flagler Village. It’s immediately south of Manor at Flagler Village.
The spending spree marks a comeback for Cardone to the top spot for South Florida multifamily deals. In 2021, Cardone dropped $744 million for a four-property portfolio in Broward spanning roughly 1,700 units.
2. Dermot drops $144M for Wellington complex
Dermot Company continued its South Florida multifamily shopping spree after making its market debut in 2021.
In October, the New York-based firm bought the 350-unit Quaye at Wellington complex at 1090 Quaye Lake Circle in Wellington for $144.2 million. Dermot assumed a $60 million State Farm mortgage on the property.
The purchase broke down to $412,000 per apartment.
Completed in 2016, the complex consists of 33 two-story buildings on a 30.6-acre site. It offers one-bedroom apartments and two- to four-bedroom rental townhomes, with monthly rents ranging from $1,945 to $4,245, according to the complex’s website and Apartments.com.
San Francisco-based Stockbridge Capital Group sold the complex to Dermot.
Led by CEO Stephen Benjamin, Dermot’s first bet on South Florida rentals was its $143 million purchase in 2021 of a pair of adjacent Boynton Beach complexes at 3501 North Federal Highway and 3480 North Old Dixie Highway with 456 units, combined.
3. Ares picks up Boca Raton property for $140M
Ares Management bought the eight-story Ceru building in Boca Raton for $139.7 million.
The Los Angeles-based investment firm scooped up the 284-unit Ceru at 5205 Congress Avenue from Fort Lauderdale-based Mainstreet Capital Partners. The deal, which closed in May, broke down to $491,858 per apartment.
Ceru, completed in 2022 on a 4.1-acre lot, consists of one- to three-bedroom units, with monthly rents ranging from $2,641 to $8,717, according to records and Apartments.com.
Led by CEO Michael Arougheti, Ares is an investment manager focused on real estate, infrastructure, credit and private equity, according to its website. It has been steadily growing its South Florida investments in recent years.
In 2021, funds managed by Ares’ Credit Group made a $150 million preferred equity investment in David Beckham’s Major League Soccer team Inter Miami CF. This month, Ares subsidiary Ares Commercial Real Estate provided a $200 million refinancing for a portion of Steve Ross’ CityPlace mixed-use complex in downtown West Palm Beach.
4. Pantzer pays $139M for Doral complex
Pantzer Properties’ $139.3 million purchase of the Point at Lakeside in Doral ranked as this year’s fourth biggest deal.
New York-based Pantzer bought the 352-unit property consisting of nine four-story buildings at 11481 Northwest 41st Street from Chicago-based AMLI Residential. The deal broke down to
$395,597 per apartment.
Led by co-CEOs Jason and Jordan Pantzer, the buyer took out an $87.7 million Freddie Mac loan for the deal.
Point at Lakeside was completed in 2013 on a 6.4-acre site, records show. It offers one- to three-bedroom units, with monthly rents ranging from $2,266 to $4,210, according to the property’s website.
5. KKR pays $134M for Doral complex
Private equity giant KKR bought the 440-unit Palmera complex in Doral for $134 million, as part of a $2.1 billion nationwide multifamily portfolio purchase.
New York-based KKR bought the property consisting of two four-story buildings at 8400 Northwest 102nd Avenue. No deed was recorded, and the deal was completed through the purchase in June of the interest in the limited liability company that owns the Palmera.
The complex, completed in 2020 on a 7.6-acre site, offers one- to three-bedroom apartments, according to records and Apartments.com. Monthly rents range from $2,401 to $3,746, Apartments.com shows.
The deal was part of KKR’s purchase of 18 properties with more than 5,200 units in California, Colorado, Florida, Georgia, New Jersey, North Carolina, Texas and Washington. The portfolio seller was Miami-based homebuilder Lennar’s apartment division Quarterra Multifamily. Quarterra reported losses this year due to overdeveloping in booming regions such as the Sun Belt.
KKR is led by co-CEOs Joseph Bae and Scott Nuttall.
6. Mormon Church buys Plantation rentals for $133M
The Church of Jesus Christ of Latter-day Saints’ commercial real estate arm bought the Ellsworth building in Plantation for $133 million.
In July, the Mormon church’s Property Reserve paid $422,222 per apartment for the eight-story, 315-unit building at 1301 Southwest 80th Terrace. The sellers, Fort Lauderdale-based Stiles and Newark, New Jersey-based PGIM Real Estate, completed development of Ellsworth last year on a 4.3-acre site.
The building offers one- to three-bedroom apartments, with monthly rents ranging from $2,640 to $4,234, according to Apartments.com.
Property Reserve, led by CEO Ashley Powell, invests the Mormon Church’s reserve funds.
7. KKR’s pays $129M for Fort Lauderdale complex –– also part of portfolio deal
KKR’s nationwide apartment portfolio purchase also included the Whitney complex in Fort Lauderdale.
In June, the private equity firm paid $129 million for the two-building, 386-unit property at 120 Northeast Fourth Street, or $334,227 per apartment.
Quarterra Multifamily completed development of the Whitney’s 14-story and 25-story buildings 2018, records show. The complex offers studios, as well as one- and two-bedroom apartments, with monthly rents ranging from $2,396 to $4,184, Apartments.com shows.
8. Bell Partners picks up Miramar complex for $121M
Bell Partners dropped $121.3 million for a 349-unit property in Miramar.
Last month, the Greensboro, North Carolina-based firm bought the Bell Miramar Place, consisting of 15 three-story apartment buildings and a pair of garages, at 11338 Southwest 45th Place. The deal broke down to $347,564 per unit.
Blackstone, through its multifamily arm LivCor, sold the property that was completed in 2012 on a 17.7-acre site.
Bell Miramar Place offers one- to three-bedroom apartments, with monthly rents from $1,957 to more than $3,647, according to the complex’s website.
Led by CEO Lili Dunn, Bell Partners made the purchase through its $1.3 billion multifamily value-add fund and borrowed a $73.6 million Fannie Mae loan. On the heels of that deal, Bell Partners paid $78.5 million for the 228-unit Bell Kendall West complex at 8485 Hammocks Boulevard in unincorporated Miami-Dade County.
9. Milestone bets on Delray Beach with $112M deal
Milestone Group scooped up a 488-unit apartment complex in Delray Beach for $111.6 million, or $228,770 per apartment.
In July, the Dallas-based investment manager bought Axis Delray Beach at 1495 Spring Harbor Drive from Wellington-based Bainbridge Companies. Consistent with the trend of buyers assuming sellers’ loans and relying on federal agency financing, Milestone assumed Bainbridge’s $61.8 million loan on Axis, boosted it to $92.2 million and transferred it to Freddie Mac.
Axis offers one- to three-bedroom apartments, with monthly rents ranging from $2,262 to $2,959, its website shows. The complex consists of 36 two-story buildings and three one-story buildings surrounding a lake, according to records. They were completed in 1988, 1990 and 2019 on a 57-acre site.
10. Abacus Capital makes $110M Pembroke Pines play
Abacus Capital Group’s $110 million purchase of a 368-unit Pembroke Pines apartment complex marked a 9 percent discount from its price in 2021.
New York-based Abacus scooped up the Marela Apartments at 250 Northwest 130th Avenue for $298,913 per unit from DWS Group subsidiary Rreef Property Trust in September. Abacus, led by CEO Ben Friedman, borrowed a $71.5 million Freddie Mac loan.
The purchase broke down to $298,913 per unit.
Completed in 1998, Marela consists of 12 three-story apartment buildings on a 21-acre site, records show. It offers one- to three-bedroom units, with monthly rents ranging from $2,075 to $2,715, Apartments.com shows.
Rreef had paid $121.3 million for Marela in 2021, or $329,484 per unit.
Source: The Real Deal’s analysis of data as provided by Colliers and CBRE, as well as of publicly available records.