NEW YORK, NY - Phoenix Realty Group (PRG) has announced the purchase of 548 distressed rental units in East Orange, New Jersey. Located within a one-mile radius, the units mostly date from the 1930s and will be renovated to bring them up to current market standards in an area attractive to commuters working in New York City and New Jersey, according to Steve Scioscia, PRG senior vice president.
Purchased for $24.2 million on behalf of a PRG institutional real estate fund, the portfolio will be improved and operated by one of New Jersey's most experienced redevelopers of value-driven apartments in emerging neighborhoods, TreeTop Development.
"This newest investment continues PRG's history of revitalizing housing in urban areas close to public transportation," said Scioscia. "We are pleased to partner with an experienced local operator with a strong track record of adding value to undermanaged properties in this region," added Scioscia, who leads multifamily and development acquisitions in New York, New Jersey and Connecticut for PRG.
The East Orange portfolio consists of mostly one- and two-bedroom units in multi-story buildings. Rents and occupancy are low compared with other apartment buildings in the market, and the comprehensive redevelopment plan will include unit and management improvements to benefit tenants and achieve market-level rental rates.
"While these rental properties represent some of the finest East Orange has to offer, they are in need of some repair and improvements to bring them up-to-date," said Adam Mermelstein, a TreeTop principal. "And we're coordinating with the City government as we work to enhance the neighborhood and deliver a high-quality, state-of-the-art product to these residents."
"We plan multi-million-dollar capital improvements to reposition and modernize the properties, which will include new landscaping, upgrading lobbies and common areas, as well as modernized elevators, new roofs, entry way doors and building systems on certain buildings," Mermelstein added.
PRG is actively investing in existing value-add multifamily properties and pursuing joint-venture development of new multifamily projects in the Tri-State region and Southern California, tapping $400 million in institutional fund capital targeted for those areas. The firm currently owns and manages market-rate apartment properties in major markets across the U.S.
Phoenix Realty Group (www.phoenixrg.com) is a national real estate investment manager and direct owner providing capital and expertise for the development and operation of rental and for-sale residential properties, low-income tax-credit housing, and mixed-use and commercial projects in urban areas across the United States. The vertically integrated firm maintains extensive fund management, underwriting, development, construction management and asset management capabilities.
PRG has attracted investments from America's leading public pension funds, banks and insurance companies, with discretionary funds that invest in opportunistic and value-added real estate ventures. The firm currently manages investments representing $2 billion in real estate development and acquisitions.
TreeTop Development LLC is a multi-faceted real estate company that has earned a strong reputation developing value-driven, sophisticated residential buildings in key urban centers throughout the New York Metropolitan area. TreeTop actively acquires and transforms existing rental properties in the region by modernizing living spaces, common areas and building systems and returning them to market.
Source: Phoenix Realty Group