A Maryland-based real estate fund is calling it quits on a Boerum Hill rental building, and taking a small hit in the process.
The Dermot Company picked up The Addison at 225 Schermerhorn Street for $142.3 million, the Commercial Observer reported. The seller was Multi-Employer Property Trust, a fund managed by BentellGreenOak.
The fund purchased the 271-unit multifamily property from Waterton Associates in 2016 for $154.3 million.
Dermot made its Brooklyn purchase in partnership with USAA Real Estate and PGGM. Capital One provided acquisition financing for the two-building asset, but the amount of financing was not reported.
A JLL Capital Markets team including Jeffrey Julien and Rob Hinckley marketed the property on behalf of BGO. A JLL team including Steven Klein and Christopher Pratt helped to arrange Capital One’s loan.
The Addison was built in 2011 and is divided between 65 studios, 117 one-bedroom units and 89 two-bedroom units. There are also three ground-floor retail spaces and a 109-spot parking garage below grade.
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Parts of the property are beneficiaries of the expiring 421a tax abatement. Two of the property’s four tax lots have about three to four years remaining on a 15-year abatement, while the other two lots are nearing the end of a 25-year abatement.
Dermot, a New York City-based investment firm, made another big move in the multifamily market in April. It dropped $180 million on a 302-unit apartment building in Midwood, Brooklyn, the largest in Brooklyn this year at the time.
Seller Northlink Capital, an affiliate of Hampshire Properties, bought the property for only $20 million in 2014. It was the site of a 90-year-old building once used by Vitagraph Studios, a silent film company. Hampshire took out a $92 million construction loan in 2018 to develop an apartment building.
[CO] — Holden Walter-Warner