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Ares drops $140M for Boca Raton apartments in biggest South Florida multifamily sale this year
Purchase of 284-unit Ceru building defies market slump
Ares Management bought a 284-unit apartment building in Boca Raton for $139.7 million, marking the biggest multifamily sale in South Florida so far this year.
Los Angeles-based Ares scooped up the eight-story Ceru property at 5205 Congress Avenue from Fort Lauderdale-based Mainstreet Capital Partners, according to records and real estate database Vizzda.
The sale defies the multifamily market slump, as elevated interest rates and skittish bank lending have put the kibosh on purchases. The only buyers still in the apartment game are either relying on insurance firms, debt funds, or Freddie Mac or Fannie Mae for loans, or they have enough capital allowing them to bypass financing.
Ares did not record a loan for the purchase, records show.
Led by Paul Kilgallon, Mainstreet developed the 277,000-square-foot Ceru on a 4.1-acre lot in 2022, according to records and the firm’s website.
Ceru consists of one-bedroom to three-bedroom apartments, ranging from 704 square feet to 1,419 square feet, Apartments.com shows. Monthly rents range from $2,695 to $5,050.
The deal breaks down to $491,858 per unit.
Ares has a market capitalization of $45.1 billion and about $428 billion of assets under management across business lines such as credit, private equity, real estate and infrastructure, according to its website. Michael Arougheti, David Kaplan, Antony Ressler and Bennett Rosenthal founded Ares in 1997. Arougheti is CEO.
In South Florida, Ares is an investor in David Beckham’s Major League Soccer team Inter Miami CF. Funds managed by Ares’ Credit Group made a $150 million preferred equity investment in Inter Miami in 2021, about the same time SoftBank’s Marcelo Claure and Masayoshi Son sold their ownership interests in the team to Beckham.
In Chicago, Ares has exited some of its investments. Last year, the firm and Skokie, Illinois-based F&F Realty sold the 492-unit, 45-story luxury apartment property at 727 West Madison Street to billionaire Zara founder Amancio Ortega’s Pontegadea for $232 million.
Other South Florida multifamily investment sales this year include Pantzer Properties’ $83.5 million purchase in March of the 245-unit The Point at Palm Beach Grove apartment complex at 7130 Okeechobee Boulevard in West Palm Beach. Also that month, New York-based crowdfunding real estate startup FundRebel bought the 12-story, 204-unit Nine Hollywood building at 809 Jackson Street and 320 South Federal Highway for $62 million.