Apartment investment activity, which tailed off to a single sale during the second quarter, had been running slow but steady. In the sole deal meeting Reis’ reporting criteria that closed during the quarter, WIP-Fireside LLC paid Hermanson Family Limited Partnership III LLLP $3.95 million ($36,574 per unit) for the 108-unit Fireside Manor Suites market-rate property at 620 N. Murray Boulevard in northeast Colorado Springs. The Class B/C property was built in 1972 and renovated in 2001. The deal closed in May at an 8.4% cap rate. The 12-month rolling mean cap per quarter-end was 6.8%, down from 7.2% a year earlier.
A major sale. “With more than 18 months of good news for apartment property owners, there have been several sales of apartment complexes to owners planning to invest and add value to old properties,” Colorado Springs Business Journal reported in August. According to a separate Journal report, a partnership between Goldman Sachs and Texas-based Arcon Group LP acquired 1,164 units in four Colorado Front Range properties for $90 million in late July. The deal included two local properties—the 216-unit Whispering Hills Apartments in northwest Colorado Springs and the 280-unit Stone Ridge Apartments in the southeastern part of the city. The two other properties were in suburban Denver. The transaction qualified as the largest “to a single investor in Colorado since 2006,” according to a press release from Apartment Realty Advisors. As noted in
Special Real Estate Factors, Colorado Springs area sales activity increased during the third quarter of 2012.