303-unit Luxury Multifamily Community in Knoxville, TN trades for $120.7M
Passco Companies, a privately held California-based commercial real estate company that specializes in acquisition, development, and property and asset management throughout the U.S., in conjunction with its joint venture partner, Greystone, a national commercial real estate finance and investment company, has acquired One Riverwalk, a 303-unit luxury apartment community completed in 2019 and located within Knox County in the Knoxville, TN MSA. The property is 97% occupied.
Through a long-term relationship with Augusta-based Southeastern, the developer of One Riverwalk, Passco was able to negotiate the direct purchase of the property, which represents the third direct transaction between the two firms since 2019. The total consideration of transactions between Passco and Southeastern has now exceeded $250MM. The other two assets include Grand Oaks at Crane Creek in Augusta, GA and One Hampton Lake in Bluffton, SC.
The purchase was subject to the assumption of a 10-year, $64.29MM Freddie Mac loan bearing a 3.12% fixed rate with over 3 years interest only periods remaining. The loan assumption was key to both firms finding mutually beneficial motivations to transact, during a time where multifamily transactions are down nationally nearly 75% since last year.
Passco was very attracted to the opportunity to expand their holdings in the Knoxville market and has experienced tremendous success from their performance of their other two multifamily assets in the market, Tapestry Turkey Creek and Trustwell Living of West Knoxville. Both assets have been outsized performers within Passco’s $4 billion portfolio. According to Colin Gillis, Senior Vice President of Acquisitions at Passco, “One Riverwalk has exhibited phenomenal performance metrics since reaching stabilization in 2020 which underscores how special the asset and location are. Apartment fundamentals within the Knoxville MSA are some of the strongest in the country and have remained consistently robust in a time where there has been significant softness across the rental sector nationally.”
“One Riverwalk is a one-of-a-kind generational opportunity to own what is arguably one of the best assets in one of the best locations in the state of Tennessee. The property has an unbelievable setting overlooking the Tennessee river and can be seen from nearly all parts of downtown. Having been built on top of the former abandoned Baptist Hospital in an underutilized blighted pocket of town, the property single handedly transformed the south side of Knoxville into a burgeoning hub of exciting new developments. Southeastern had tremendous vision when they undertook this project and the impact that One Riverwalk had on the immediate area has been truly phenomenal”, explains Gillis.
“We’re thrilled to partner with Passco on this transaction. The ongoing collaboration serves as a testament to our relationship and further demonstrates our ability to execute within these market conditions,” said Stanley Wuu, Director, Greystone, who works closely with Passco to help grow a portfolio of attractive multifamily investments for the two companies’ joint venture DST platform.
This waterfront property sits upon 3.35 acres boasting views of Downtown Knoxville. One Riverwalk is comprised of two 5-story residential buildings offering a mix of studio, 1, 2-bedroom units averaging 884 square feet. Each unit is modern with quartz countertops, luxury faux wood flooring, tile backsplash, stainless steel appliances, full lighting packages and beautiful views of the Tennessee River. The community is just a bridge away from everything and located at 151 E. Blount Ave. Knoxville, TN.
Originally published by Yahoo! Finance.
