Source: Preferred Apartment Communities / #Apartments #Multifamily
ATLANTA, GA - Preferred Apartment Communities, Inc. announced its acquisition on December 31, 2013 of a 140-unit multifamily community located in Atlanta, Georgia ("Summit II") adjacent to the Company's 345-unit Summit Crossing community ("Summit I") for a purchase price of approximately $19.9 million.
Summit II was completed in 2013 and has a current occupancy of approximately 96.4%. PAC intends to combine Summit II with Summit I and operate the combined properties as "Summit Crossing" and brand it as "a Preferred Apartment Community." PAC acquired Summit II pursuant to the terms of the purchase option that was executed when PAC made a mezzanine loan investment to partially finance the construction of Summit II. In connection with the acquisition, PAC's mezzanine loan was paid in full, including the payment of approximately $605,000 in an accrued exit fee. We expect the expanded Summit Crossing community will be a solid contributor to the continued dynamic growth of the Company.
Upon the acquisition of Summit II, PAC assumed the current $12.4 million senior loan from Atlantic Capital Bank ("ACB"). In connection with this assumption, the ACB loan was increased to $13.0 million, the maturity date was changed to June 2014 and the interest rate was set at a floating rate of 30-day LIBOR plus 2.50%. There are no loan guaranties provided by PAC. PAC currently intends to refinance Summit II with a new loan from Freddie Mac within six months.
Preferred Apartment Communities, Inc. is a Maryland corporation formed primarily to acquire and operate multifamily properties in select targeted markets throughout the United States.