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December 10, 2015

Three apartment complexes in greater Portland sell for $50 million

Courtesy of CBRE | The Boulos Company An aerial view of one of the properties sold, Tamarlane Apartments, which consists of 115 units in the Back Cove area of Portland off of Canco Road.
Courtesy of CBRE | The Boulos Company Coach Lantern Apartment in Scarborough was sold in a three-housing complex deal totaling more than $50 million.
Courtesy of CBRE | The Boulos Company Foxcroft Apartments, off of U.S. Route 1 in Scarborough, was also sold in the deal.

The $50.25 million sale last week of three townhouse and apartment communities in Portland and Scarborough represented the biggest residential property sale in the greater Portland area in recent history.

The Dec. 1 sale of the combined 309 residential units from an affiliate of a Philadelphia-based real estate investment firm to a Massachusetts company demonstrated the high value of multi-family properties to investors, said Joe Porta, one of the brokers involved.

The greater Portland area is following the national trend of multi-family properties being highly prioritized investment properties because rents are increasing and the debt is less expensive than for other properties, said Porta, a partner of CBRE | The Boulos Company in Portland. Investors can get better terms when purchasing multi-family properties compared to other commercial properties such as office buildings, he said.

The sale, one of the largest sales in greater Portland history, according to Porta, included three apartment complexes: Tamarlane Apartments, which consists of 115 units in the Back Cove area of Portland off of Canco Road; Foxcroft Apartments, which consists of 104 townhouses off of U.S. Route 1 in Scarborough; and Coach Lantern Apartments, which consists of 90 townhouses also located off of Winnocks Neck Road in Scarborough.

Porta said part of the the reason why the properties sold for such a high price is that the rents of some of the units were increasing by 20% in the last calendar year.

“When you have revenue that’s doing that and you have inexpensive debt, you have a lot of opportunity,” he said.

With those trends expected to continue, Porta said multi-family properties will remain highly valued by investors.

An affiliate of Philadelphia-based Resource Real Estate sold the properties to an affiliate of Chestnut Realty Management, based in Springfield, Mass. Porta said it’s the first entry in the greater Portland marketplace for Chestnut Realty Management, which owns industrial, retail and multi-family properties mostly in Massachusetts.

Simon Butler and Biria St. John of CB Richard Ellis – N.E. Partners LP and Porta represented the seller and secured the buyer.

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