NORFOLK, VA - Harbor Group International (HGI) announced that affiliates of the Company have acquired a 25-property, 9,677-unit multifamily portfolio spanning five major metropolitan areas from affiliates of Lone Star Funds. The $1.8 billion transaction is the company’s largest to date and increases HGI’s investment portfolio from approximately $5.2 billion to $7.1 billion.
The properties are located in the Washington, D.C. metro area, Philadelphia, Baltimore, Chicago and Boston. HGI plans to invest approximately $80 million to upgrade unit interiors, enhance property amenities and improve curb appeal.
The portfolio is located in supply-constrained in-fill markets, each of which benefits from solid demographics, convenient transportation, access to highways and desirable school districts. Average occupancy for the portfolio is approximately 95% and HGI believes its value-add initiatives and focused management will boost revenue.
Meridian Capital Group provided investment advisory and mortgage brokerage services to HGI, including the placement of approximately $512 million of fixed rate debt with New York Community Bank. In addition, Berkadia Commercial Mortgage provided $930 million of fixed and floating rate debt through Freddie Mac.
Lone Star was represented by Eastdil Secured.
Harbor Group International is a private real estate investment and management firm, which controls a portfolio of worldwide assets valued at $7.1 billion. HGI is headquartered in Norfolk, Virginia with offices in New York, Baltimore and Tel Aviv. The company’s real estate holdings include 4.8 million square feet of commercial properties and approximately 30,000 apartment units.