Waterton Sells West Miami Apartment Complex to FCP for $111M

Waterton Residential sold a 427-unit apartment complex in West Miami for $111 million, marking a 4.7 percent discount from its purchase price nearly a decade ago.

Chevy Chase, Maryland-based FCP, or Federal Capital Partners, bought District West Gables, consisting of a pair of seven-story buildings at 2001 and 2101 Ludlam Road/Southwest 67th Avenue, from Chicago-based Waterton, according to records and real estate database Vizzda. The deal breaks down to $259,953 per unit.

Waterton, led by CEO David Schwartz, had paid $116.4 million for the complex in two deals in 2016 and 2017, records show. The firm bought the 206-unit building at 2101 Ludlam Road for $57.4 million in 2016, about a year after South Miami-based multifamily developer Estate Companies completed construction, according to records. In 2017, Estate completed the building at 2001 Ludlam Road, selling it that year to Waterton for $59 million.

Estate, led by Robert Suris and Jeff Ardizon, developed the complex under its Soleste multifamily brand.

On a 4.1-acre site, District West Gables consists of studios and one-bedroom to three-bedroom apartments, property records and Apartments.com show. Asking rents aren’t listed.

FCP’s District West Gables purchase marks its third South Florida multifamily investment in less than a year. In December, the firm paid $67.5 million for the 250-unit Solena Miramar complex at 3155 Southwest 147th Terrace in Miramar. FCP also bought the 400-unit Arium Sunrise complex at 1501 Northwest 124th Terrace in Sunrise for $90 million in February.

FCP, led by CEO Garland Faist, has invested and financed more than $14.6 billion in residential and commercial properties nationwide since it was founded in 1999, according to its website. It’s currently managing six funds with a total of $4.2 billion in assets.

At District West Gables, FCP plans renovations to common areas, amenities and apartments, according to the firm’s news release announcing the purchase. FCP hired Greystar to manage the property. Records show FCP didn’t record a mortgage, likely signifying its District West Gables purchase was all cash.

The discounted sale comes amid a calmer South Florida multifamily market compared with the bonanza during the pandemic. Over the past two years, elevated interest rates, a supply overhang due to a development frenzy and other headwinds have slowed investment sales and prompted a flatlining –– and even declining –– in rents.

Developers completed a record 18,600 apartments last year, outpacing 15,000 net leases signed, according to CoStar data.

Sales have shown an uptick in recent months. Investors buying apartments largely are finding workarounds to bank financing by purchasing with all cash, using Freddie Mac and Fannie Mae loans or assuming sellers’ loans.

Spanish billionaire Amancio Ortega, known for purchasing with all cash, paid $165 million for the 44-story, 259-unit Veneto Las Olas apartment tower at 201 South Federal Highway in Fort Lauderdale in June.

Last month, Related Fund Management borrowed a $59.1 million Freddie Mac loan for its $116.9 million purchase of the 292-unit Aura Delray Beach complex at 2095 West Atlantic Avenue in Delray Beach.

Also last month, The Milestone Group paid $46.4 million for the 206-unit Casa Brera at Toscana Isles at 4725 Via Bari in unincorporated Palm Beach County, near Boynton Beach. The buyer assumed the seller’s $27.4 million Fannie Mae loan on the property and borrowed an additional $7.7 million Fannie Mae loan.