Miami investment firm enters Atlanta market with East Point apartment buy


Redwine Creek Apartments.

A new investor has entered the Atlanta apartment market with its first acquisition in East Point.
An affiliate of Miami-based Bayshore Investment Partners LLC bought the second phase of the 175-unit Elevation 3505. Bayshore Investment paid $24.8 million for the East Point project, or $142,000 per unit.

The seller was Landmark CG (Phase 2) LLC, an affiliate of Atlantabased Stonemark Management LLC. Bayshore Investment Partners has rebranded the property Redwine Creek Apartments, said Jose Tello, principal and general partner at Bayshore Investment. It will be managed Cynergy Property Management LLC.

Redwine Creek Apartments, at 3505 Redwine Road, sits on 15 acres along Interstate 285. It’s also next to the 800,000-square-foot Camp Creek Marketplace retail center. The apartments are four miles from Hartsfield-Jackson Atlanta International Airport.

The first phase of Elevation 3505 was built in 2006 and has 317 units. The current owner plans to sell this year, and Bayshore Investment will consider acquiring it, Tello said. «It makes sense from an efficiency standpoint,» he said. Bayshore Investment wants to expand into Southeast markets including Atlanta and Raleigh-Durham, Tello said. It targeted Atlanta for its growth, deal flow, and «dynamic» employment hub, he added. «It was the next market that made sense for us,» Tello said.

Bayshore Investment aims to acquire up to five properties and 1,000 units in Atlanta over the next three years, he said. It will also continue to look for acquisitions in Florida, where the company already has a 1,500-unit portfolio mainly in Orlando and Tampa.

In Atlanta, the company is most focused on the «martini glass» corridor between Interstates 75 and 85 for the area’s steady demand, rent increases and population growth, Tello said. Bayshore Investment is a cash-flow, longterm investor. It liked Elevation Phase 2 because 75% of its units had been refurbished by the previous owner, a value-add investor, Tello said. It will update the remaining 25% of Phase 2 units with new appliances, countertops, vinyl flooring and lighting fixtures as tenancy turns over organically.

East Point could be a good location for Bayshore Investment because of the area’s growth over the last 10 to 15 years. It’s 15 minutes from the airport, it has the amenities of Camp Creek Marketplace, and airport employees from different airlines work in the area, Tello said. South Atlanta is also more affordable than the corridor between I-285 and 75.

Bayshore Investment would like to do another deal in East Point, Tello said. It is also is interested in properties in Atlanta’s northern suburbs in cities such as Marietta and Alpharetta. Tello noted the presence of more Fortune 500 companies on the north side of Atlanta. “We want to grow in other interesting markets (in) south Atlanta, however, they are probably not as tight as other submarkets in North Atlanta like Marietta or Alpharetta. We looked at Stockbridge and Jonesboro but we would need a premium in terms of cap rate because those markets are not as tight compared to other submarkets in North Atlanta,» Tello said.

Nat Scarmazzi, Brian Gaswirth, and Jesse Wright of HFF Miami assisted BIP with financing. Bayshore Investment was represented by Chad Freedman of Ballaga, Freeman & Atkins LLP. Shea Campbell and Keith Geiger of CBRE represented the seller in the transaction.

Bayshore Miami

Commercial investors, developers scour Little Havana for hot deals

InTown, a luxury apartment building that opened last year, has spurred nearby investment

In Little Havana, a popular restaurant that once hosted the late President Ronald Reagan for a Cuban coffee visit will soon become a retail and parking project. Nearby, developer J. Milton plans a new apartment complex as rents rise.

These developments and more, reinforced by the launch of the new rental project InTown, mark continued investment in the Miami neighborhood. Once a largely overlooked area, deep-pocketed investors are increasingly picking up commercial sites that have not yet been redeveloped, buyers and brokers told The Real Deal.

In late June, a 25,000-square-foot development site at 140 Northwest Eighth Avenue sold for $2.25 million, or about $90 per square foot, commercial broker Carlos Fausto Miranda said. Property records show the buyer is River Border Development LLC, a Coral Gables-based entity controlled by Gilbert Contreras, who has been developing small-scale multifamily projects in Little Havana.

It’s one of a steady stream of deals in Little Havana and surrounding areas. At 2055 Southwest Eighth Street, a group of investors that includes David, Daniel and Brian Lombardi of Lombardi Properties and Jared Brunnabend of Bayshore Investment Partners in June paid $3.1 million for a 20,250-square-foot property. The site currently houses a nearly 7,300-square-foot retail strip with parking. The land traded for $153 per square foot.

It was on the market for $3.2 million with Miranda, broker and president of Fausto Commercial Realty Consultants, according to his website. The property, which will eventually be redeveloped, is across the Eighth Street from InTown, a newly completed luxury apartment complex that sold in November for $89 million.

Lombardi, an early investor in Wynwood, plans to make improvements to the shopping strip and bring in new tenants over the next couple of years. It’s the first partnership for the firm and Bayshore Investment Partners, the latter of which has traditionally focused on multifamily investment in Florida.

“We think the demographics of Calle Ocho are getting a little younger and the services traditionally offered don’t meet the current demographic,” Daniel Lombardi told TRD.

Rents at InTown, which developer Henry Torres sold to Greystar, start at roughly $2,300 a month for a two-bedroom, a leasing agent said on Tuesday, although incentives are being offered to real estate agents and renters. A two-bedroom in Little Havana asks on average $1,650 a month, according to a recent RentHop report, but rents in older buildings are lower, brokers say.

Lombardi is part of the group of early Wynwood investors who began acquiring properties and turning them into adaptive reuse projects starting in the early 2000s, eventually acquiring nearly 6 acres of Wynwood land, including the Wynwood Yard.

Lombardi said the company isn’t under contract to purchase more land in Little Havana, but is actively looking for more opportunities. “It’s been hard for us to find deals that make sense,” he said, citing sky-high prices.

Other recent sales include the $1.7 million sale of a corner retail building in East Little Havana. The 11,130-square-foot building at 101 Southwest 12th Avenue is the former site of Juanito’s Esquina de Tejas, the restaurant that once hosted a guayabera-clad Reagan for a cafecito. The buyer plans to redevelop the nearly 13,000-square-foot property with national tenants on the ground floor and a parking ramp and garage on the second floor, Miranda said.

Records show the Schmalts Group, a Providence, Rhode Island-based LLC, is the buyer. David Malkin, a real estate investor based in Providence, Sharon Strassfield of Massachusetts, and Richard Shuster of New York-based Boston Partners, manage the company.

Year-to-date, Miranda has closed about $20 million of deals in Little Havana, where his company is based. Two apartment buildings with a combined 11 units at 550 and 570 Southwest Seventh Street sold to a Venezuelan development group for $1.7 million, or $113 per square foot, in June, Miranda said. Guanche 4105 Inc., which is managed by Arturo Ortega of Brickell, is the buyer, property records show.

The neighborhood is seeing a number of small-scale retail and multifamily projects. Retail rents are higher on Calle Ocho between 13th and 17th avenues, with rates ranging there from $30 to $45 per square foot, triple net. Within Little Havana, they range from $20 per square foot to $30 per foot, Miranda said.

“We’re building on trends that started years ago, with a better mix of national and also local home-grown retails tenants,” he said.

But the area is “starved for middle-income housing,” he said. In addition to InTown, multifamily developer J. Milton & Associates is moving forward with its plans for a 12-story apartment building at 1000 Northwest Seventh Street near Marlins Park and the Miami River.

“We’re working with an area driven by significant population and economic growth,” Miranda said, adding that it’s “easy to see how there is a clear path for rent growth and that must be factored into pricing.”


Miami investment group buys Brandon Crossing Apartments

Miami’s Bayshore Investment Partners purchased the 200-unit Brandon Crossing Apartments for $14.5 million.

BUYER: Brandon Crossing Investors LLC (manager: Jared Brunnabend), Miami
SELLER: Brandon Crossing Partners Ltd.
PROPERTY: 1911 Brandon Crossing Circle, Brandon
PRICE: $14.5 million
PREVIOUS PRICE: $2.26 million, December 1982 and $1.3 million, January 1997
LAW FIRM ON DEED: Lowndes Drosdick Doster Kantor & Reed PA, Orlando

Miami’s Bayshore Investment Partners purchased the 200-unit Brandon Crossing Apartments for $14.5 million.

The price equated to $72,500 per unit. That figure is lower than the average price per unit for multifamily space ($70,803) in the Tampa Bay area, according to the CoStar Group.

Built in 1999, the 10-building apartment complex features a swimming pool, fitness and business centers and a playground. Its occupancy was in the mid-90% range at the time of the sale. Units average 1,053 square feet, according to CoStar.

Jared Brunnabend, principal of Bayshore Investment Partners, says the firm was attracted to the property by its location.

The investment group does not own any other apartments in the Tampa Bay area, he says, but is evaluating new opportunities in the region.

The purchase entity, Brandon Crossing Investors LLC, mortgaged the property to Walker & Dunlop LLC for $10.36 million.