The $172.5 million that changed hands in seven investment sales meeting Reis’ criteria during the first half 2012 put the market on track to exceed the total achieved in 2011. The average selling price and mean cap rate were $92,000 per unit and 6.9%. The total for the two sales that closed in second quarter alone was $40.7 million at an average of $80,000 per unit. In the quarter’s largest deal, Harbor Group International LLC paid The Bainbridge Companies $36.34 million ($81,855 per unit) for the 444-unit Turtle Cove Apartments in West Palm Beach. The deal closed in June at a 6.7% cap rate. The 1987-built Class B/C property was 7.0% vacant at time of sale. The deal was part of a $99.7 million, three-property portfolio sale.
“Property owners and prospective owners appear better able to close the gap in price expectations than a few months ago, setting the stage for additional near-term deals,” comments Marcus & Millichap.