Magma Equities, based in Manhattan Beach, Calif., recently announced the purchase of Independence Park Apartments, a 312-unit, garden-style community in Durham, N.C., for $50 million. The firm began due diligence on the asset prior to the onset of the coronavirus. Jesse Nichols, principal in the Los Angeles office of Polsinelli, was Magma’s legal representative.
Dennis Harris at The Kirkland Co. represented the unidentified seller. Abe Spira and Justin Hechler at Greystone secured the debt with Freddie Mac through its floating-rate loan program. The off-market deal slipped under the radar in the still bubbling real estate market of the Research Triangle in North Carolina.
“As active buyers in the region, we were able to source the opportunity off-market and avoid the competitive bidding process,” said Magma CFO Michael Wagar. “As a result, we were very comfortable with the price as negotiated. This was a very good deal for us in January and a very good deal for us now. Despite the current challenges, we expect it to perform well over the long term.”
The vintage 2009 community features a mix of one-, two-, and three-bedroom units housed in 13 three-story residential buildings on a 23-acre site that’s about 4 miles north of downtown Durham. Community amenities include a swimming pool, a fitness center, a business center, a clubhouse, a 24-seat theater, a tennis court, a sand volleyball court, a basketball court, a playground, and a dog park.
The Raleigh-Durham area continues to attract talent and investment, taking its fuel from Duke University, the University of North Carolina at Chapel Hill, North Carolina State University, and North Carolina Central University.
“The Research Triangle is a highly desirable employment center that attracts recent graduates from highly regarded surrounding universities to its top employers,” said Magma principal Robert Murray. “In the midst of COVID-19, we stress-tested the Independence acquisition differently than when we first approached it and were able to work with all parties involved to get the transaction done.” The property was 96% occupied at the time of closing. Planned renovations are currently suspended due to the pandemic.