Harbor Group Buys Multifamily Portfolio for $562M

AH Realty Trust, formerly known as Armada Hoffler, is looking to exit the multifamily sector, and Harbor Group International is picking up some of the pieces.

HGI acquired an 11-building portfolio from AH Realty for $562 million, the seller announced on Monday. A letter of intent regarding the acquisition was distributed last month and the sale is expected to close in the middle of the year.

The release doesn’t specify what buildings are being traded in the all-cash deal, but Multi-Housing News revealed the properties to be in Virginia, Maryland, North Carolina and Georgia. All told, there are 2,433 units involved, breaking the deal down to nearly $231,000 per unit.

Richard Litton’s HGI picked up another 11-property portfolio less than a year ago, snapping up buildings in the Southeast for a combined $625 million, according to the Commercial Observer. It also bought five New England multifamily properties with 2,719 units from Aimco for $740 million last summer as that seller liquidates its holdings.

AH Realty is going through a transition of its own; the sale is part of a previously announced pivot for AH Realty, which is in the midst of divesting from its multifamily, construction and real estate financing businesses. The company, which rebranded earlier this month, is looking to acquire retail assets and lean more into the office sector.

“This transaction allows us to realize that value, strengthen our balance sheet, and advance our focus toward a simpler real estate platform,” AH Realty CEO Shawn Tibbetts said in a statement. Proceeds from the deal will go towards reducing the real estate investment trust’s debt.

AH Realty will have only three multifamily properties left after the sale closes, two of which the company plans to market for sale, leaving Smith’s Landing Apartments in Blacksburg, Virginia, as the lone survivor in the company’s holdings for the sector.