Fairfield Residential bought a massive West Palm Beach apartment complex for $208 million, as the multifamily market finds it footing after a slowdown in recent years.
The multifamily trade was the second biggest in South Florida so far this year.
San Diego-based Fairfield purchased the 812-unit Portofino Place Apartments at 4400 and 4600 Portofino Way from Atlanta-based Cortland, according to records and real estate database Vizzda. The deal breaks down to nearly $256,200 per door.
Completed in 2003 and 2006, the complex consists of 34 three-story buildings and a pair of clubhouses and stretches on nearly 40 acres, Vizzda records show.
Fairfield took out loans of $93.1 million and $85 million for the deal, both from Freddie Mac and maturing in 2033.
Cortland purchased Portofino Place in 2016, when the complex consisted of the 416-unit community at 4400 Portofino Way and the 396-unit one at 4600 Portofino Way, and combined them into one complex. Terms of that purchase weren’t disclosed.
Cortland is led by Steven DeFrancis.
Fairfield, led by Richard Boynton, is a multifamily investment, development and management firm with a portfolio of 50,600 units nationwide, including seven properties in South Florida according to its website.
It also has shed some regional holdings. In 2019, Fairfield sold the 292-unit ORA Flagler Village apartment complex for $92 million.
South Florida multifamily investment sales picked up in the first half of this year, with the total volume hitting $2.5 billion, an increase of 19.4 percent from a year prior, according to Avison Young.
Still, market watchdogs have warned that some of this may be due to deals put under contract late last year and only closing this year. Inflation and elevated interest rates are still slowing down deals, Avison’s Michael Fay said earlier this month.
Apartment leasing has been clawing its way back over the past year, after demand couldn’t keep up with the hefty deliveries of new units over the past three years. In the 12 months ending in the second quarter, new leasing reached 13,774 units, edging past the 12,751 units completed, marking the first time in three years that demand outpaced supply, according to CoStar Group.
As the glut eased, landlords have pulled back on concessions, though some still include a month or two of free rent to sweeten deals for prospective tenants. Rents have been on a steady decline, with the average asking rate in South Florida settling at $2,279 in July, a 1.3 percent decrease year-over-year, according to Realtor.com.
Cortland shed the Residences at Uptown Boca complex for $240 million in May, the same month the Church of Jesus Christ of Latter-day Saints paid $240 million for a Boca Raton apartment complex. Those deals marked the biggest known South Florida multifamily sales so far this year.
Other major sales this year include Dutch firm Breevast U.S. buying the multifamily property at 19401 West Dixie Highway in Miami for just under $110 million in May. Also, Harbor Group International paid $109 million this month for the 505-unit Emerald Palms apartment complex at 12315 Southwest 151st Street near Zoo Miami.
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