Private equity landlord drops $10M for Palm Beach Gardens apartments

In the aftermath of the controversial rent reform laws in New York City, at least one property owner has decided to sell off assets in the city and focus on South Florida.

The private equity firm Sky Lake Partners, led by Marlena Demenus, purchased 29 units at multifamily properties in Palm Beach Gardens for $9.92 million, according to a release. Sky Lake bought 19 units at the Legacy Place at 1000 Legacy Place and 10 units at Alton Townhomes at 8072-8110 Hobbes Way.

Sky Lake bought the Alton townhomes from developer Kolter Group, while it purchased the units at Legacy Place from New York-based Bhansali Equities, according to Compass Commercial’s Brad Kuskin, who represented Sky Lake in the deal.

The purchase price broke down to $341,000 per unit. The units range from one to four bedrooms and the owner plans to rent out the properties, Kuskin said.

The move is part of Demenus’ decision to completely sell off her entire $34.7 million portfolio of New York properties, which include apartments in Harlem and the Bronx, according to Kuskin. Demenus is buying properties in Florida in part because the state has more favorable tax laws compared to New York, Kuskin said.

Some high net worth individuals are moving to the Sunshine State after President Trump’s 2017 tax legislation capped the amount wealthy individuals in high tax states can deduct. Florida, meanwhile, has no state income tax.

Sky Lake’s first deal in South Florida was a $14.75 million purchase at the Residences at Latitude Delray Beach, where it plans to convert the apartment complex to annual rentals.

Sky Lake is a private equity firm specializing in multifamily and mixed-use real estate investments, according to Demenus’ LinkedIn page. Sky Lake recently sold nine buildings in New York City.